Nutek Inc. Announces Acquisition of Crystal Resources and New Management Team for its Oil Operations in Texas
LAKE FOREST, Calif.--(BUSINESS WIRE)--May 28, 1998--With the acquisition of Crystal Resources Inc. and the installation of a new management team, Nutek Inc. (OTCBB: NUTK) is entering a new phase of production and development in South Texas.
In line with industry standards, Nutek has spent two years applying and testing new technologies to the oil fields of South Texas. By utilizing the data amassed by the prior management, Vac-U-Lift and Crystal Resources, both subsidiaries of Nutek, are embarking on what is and will be an endeavor to make its mark on the domestic oil and gas industry.
New management will utilize the production data and equipment of Vac-U-Lift and Crystal Resources to immediately insure commercial oil production, with methodology of mobile production units (swabbing units). The aforementioned production system was designed to lower the costs of producing oil.
Hence, making marginal wells profitable and breathing life back into today's oil patch, which largely consists of older wells and fields. The results of these advanced systems have been mixed at best. With some breakthroughs that have been made and with the new seasoned management in place, the rewards and economic profits are rapidly forthcoming. Nutek is now in the position to become a substantial oil producer in Southern Texas.
The utilization of swabbing units and/or Mobil production units as a means of producing oil in South Texas has yielded a by-product that is a tremendous opportunity for Nutek. This "By-product" is vast amounts of test data that depicts the characteristics of numerous formations and oil fields throughout South Central Texas, accompanied by lease acreage, drilling sites and the means via swabbing units to acquire additional drilling locations.
Due to the emergence of a technological breakthrough that is just now reaching its economically maturation, the sprawling operations of Vac-U-Lift, in combination with Crystal Resources, has put Nutek in a position for explosive growth.
This "mature technology" is horizontal drilling. Horizontal drilling was first applied in South Texas in the late 1980s and early 1990s with much publicity. Unfortunately, the results were disappointing for many companies due to the fact that initial drilling costs and the cost of capital were exorbitant. Even with these limiting factors, hundreds upon hundreds of horizontal well-bores were drilled throughout South Texas, yielding millions of barrels of oil.
Today, horizontal drilling costs have dropped over 70 percent. Further, horizontal well-bores can be drilled more accurately, faster and in multiple directions out of the same well bore. In essence, horizontal technology has matured. Nutek is also maturing with its oil subsidiaries in South Texas. Nutek has tested, produced and collected data on a select number of oil fields that are prime candidates for the application of horizontal technology.
With a new management team in place in Texas, the Nutek oil subsidiaries will also be placing an emphasis on completing three important projects, the first project being the Big Foot infield-drilling program. The newly drilled well in Big Foot will be completed and tested. The new management feels that the Big Foot infield-drilling program holds a tremendous potential for additional development. The second project is the Qualified Depth Swabbing Operation of Crystal Resources. This program should yield excellent cash flow. The third project consists of the acquisition of a gathering company, which will greatly enhance profitability for the Southern Texas operation.
CONTACT:
Nutek Inc., Lake Forest
Michael A. Furr, 714/587-9400
Fax: 714/587-9534
mfurr@ix.netcom.com
KEYWORD: CALIFORNIA TEXAS
BW1077 MAY 28,1998
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