Fortune Natural Resources Corporation Announces Sale of East Bayou Sorrel Interests
HOUSTON--(BUSINESS WIER)--March 31, 1998--FORTUNE NATURAL RESOURCES CORPORATION (AMEX:FPX)(AMEX:FPX.W) today announced the sale of its property interests in the East Bayou Sorrel field, Iberville Parish, Louisiana, for $4,695,000 in cash. The Company said that it closed the transaction earlier today with the purchaser, National Energy Group, Inc., which also is the operator of the field. The properties sold consisted of the Company's interest in the Schwing No. 1 and No. 2 wells and all the Company's interests in leases and facilities in the East Bayou Sorrel area. The sale is effective April 1, 1998.
As of December 31, 1997, according to the Company's independent petroleum engineers' report from Huddleston & Company, 152,000 barrels of oil and 204,000 mcf of natural gas or a total of 186,000 BOE were assigned as their estimated net proven reserves to Fortune's interests in the East Bayou Sorrel field. The sale, therefore, represented approximately 23% of the Company's total estimated net proven reserves as of December 31, 1997.
Additionally, and concurrently with the closing, the Company elected to retire $540,000 of debt on its $20 million credit facility with Credit Lyonnais, virtually eliminating the Company's outstanding debt on the facility. It is anticipated that the balance of proceeds received from the sale will be used for investment in the Company's ongoing exploration program and working capital purposes.
FORTUNE NATURAL RESOURCES CORPORATION is an independent oil and gas exploration and production company with its principal properties located onshore and offshore Louisiana and Texas. For a discussion of the contingencies and uncertainties affecting future events and forward-looking statements, see Fortune's December 31, 1997 annual report on Form 10-K and its other SEC reports.
CONTACT:
FORTUNE NATURAL RESOURCES CORP., Houston
John L. Collins, 281/872-1170
KEYWORD: TEXAS
BW1393 MAR 31,1998
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