Stratex Oil & Gas Holdings, Inc. Acquires Working Interests in Jeffrey Lease Located in Callahan County, Texas
December 3, 2013 - Watertown, CT
WATERTOWN, CT--(Marketwired - December 03, 2013) - Stratex Oil & Gas Holdings, Inc. (OTCQB: STTX) ("Stratex" or "the Company") announced today that it had acquired certain working interests in the Jeffrey Lease (the Lease"), located in Callahan County, Texas. Stratex will conduct various drilling, workover and completion activities on the property. The Company will own a 64% working interest ("WI") and a 48.64% net revenue interest ("NRI") in what will initially encompass a 60 acre pooled tract. The seller will be entitled to a 12.5% back in WI (9.5% NRI), to be borne by all working interest owners. Stratex's after payout WI will be 56% (42.56% NRI).
All work to be done on the Lease will be of a fixed turnkey nature, wherein the Company will not be responsible for any cost overruns (if any), and would benefit from cost savings (if any). Stratex, as the majority WI owner, will initially have the right to participate in significant operational decisions and observe all aspects of the initial work program. Total consideration to be paid by Stratex will include a cash payment of $308,800, plus the assignment to the seller of 150,000 shares of common stock. The purchase was financed with existing cash on the Company's balance sheet.
The Lease currently includes 5 wellbores, of which 1 is active but currently shut in, 2 are former producers capable of conversion into injection/salt water disposal wells, and 2 are presently salt water disposal wells (one of which is capable of being converted back to producer status). The work program will be completed by yearend 2013. The 3 locations to be drilled by Stratex and other WI owners are all infill, within the productive limits of the EGN Field. The primary drilling objective of the 3 well infill program is the prolific King Sand, at a depth of approximately 1,500 feet. The consideration for the acquisition includes the entire cost of the work program. Upon completion of the work program, Stratex will have the right to assume the role of operator.
The Jeffrey Lease has produced continuously since the 1950s, and has produced in excess of 200,000 barrels of oil to date. The Lease is a portion of the larger EGN Field, which has produced better than 2 million barrels of oil. All WI owners in the Lease have agreed to enter into a 16,000 acre Area of Mutual Interest ("AMI"), which is centered around the Jeffrey Lease.
Depending upon the results of the work program, this project and general geographic region could represent a new core focus area for Stratex. Stephen Funk, Chairman and CEO, stated, "Stratex is excited at the prospect of adding meaningful incremental production and proved reserves, due to this acquisition. There are also deeper pool opportunities along stacked pay reservoir systems for future potential exploitation. We will actively be seeking bolt-on properties in order to increase our footprint within this area. Stratex's management remains fully committed to increasing shareholder value."
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About Stratex Oil & Gas Holdings, Inc.
Stratex is an independent energy company focused on the exploration, acquisition, and production of crude oil in the Bakken and Three Forks formations in North Dakota and Montana. Its oil and natural gas operations are primarily concentrated in two Rocky Mountain basins, the Williston Basin of North Dakota and Montana. Stratex's corporate strategy is to internally identify prospects, acquire lands encompassing those prospects, and evaluate those prospects using subsurface geology and geophysical data. Using this strategy, Stratex has developed an oil portfolio of proven reserves, as well as development opportunities on high potential oil prospects.
Stratex's core operating areas are the Williston Basin in North Dakota and Montana, and the Denver-Julesburg Basin in Colorado. In the Williston Basin, Stratex focuses on oil production from multiple zones including the Bakken Shale and Three Forks Sanish Formations. In the Denver-Julesberg Basin Stratex focuses on the Niobrara and Codell Formations.
Stratex engages geologists, petroleum engineers, and geophysicists with years of relevant industry experience in the basins where the Company operates. Stratex strives to retain operations on its lands wherever possible in order to control the timing of the development of its leasehold. For more information visit: http://www.stratexoil.com
This press release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995 (the "Act"). Additionally, words such as "seek," "intend," "believe," "plan," "estimate," "expect," "anticipate" "project" and other similar expressions are forward-looking statements within the meaning of the Act. Some or all of the events or results anticipated by these forward- looking statements may not occur. Factors that could cause or contribute to such differences include the ability of Stratex Oil & Gas to attract customers for its services, and to continue developing its oil & gas assets. Further information on Stratex's risk factors is contained in its filings with the Securities and Exchange Commission, including the Form 8-K filed in connection with the Merger. Stratex Oil & Gas does not undertake any duty nor does it intend to update the results of these forward-looking statements.
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