Business
Participation in auction to acquire oil assets
Participation in auction to acquire oil assets.
About this update from Corcel Plc
[{"type":"text","content":"\n \nRNS Number : 5778X Regency Mines PLC 09 May 2016 \n\n \n \nRegency Mines PLC\n(\"Regency\" or the \"Company\")\n \nParticipation in Auction to Acquire Wyoming Oil Assets\n \n09 May 2016\n \nRegency Mines, Plc, the natural resources exploration and investment company with interests in oil and base metals announces a Heads of Agreement (\"HOA\"), non-binding and subject to transaction documentation, entered into between a private U.S. oil and gas company (\"US Partner\" or \"Operator\") and Regency's wholly owned United States subsidiary, Regency Resources, Inc (\"RRI\") to bid in an auction process under a Chapter 7 bankruptcy proceeding for a 75% non-operating working interest (net revenue interest to Regency of 60%) in an existing well (\"Well\") located in the prolific oil producing State of Wyoming. \n \nThe Well was recently drilled, logged and cased, at a cost in excess of US$4m, but was not perforated by the previous ownership group following financial difficulties and the sector downturn. The Well is being sold by a court appointed Trustee pursuant to a Chapter 7 proceeding under U.S. bankruptcy law. \n \nThe Operator has calculated from modern well logs that the Well has more than 470,000 barrels potentially recoverable behind-pipe in multiple stacked pay zones, with more than 150,000 barrels potentially recoverable in the two deepest pay zones that will be completed initially. The target identified by the Operator is 29 million barrels of potentially recoverable oil within the entire acreage position.\n \nFive producing fields are located within 1 to 10 miles of the Well. The surrounding fields all produce from one or more of the same zones that appear productive on logs in the Well. \n \nIf RRI and its US Partner are the successful bidder at the bankruptcy sale, Regency will also acquire a 75% interest in its US partner's right to earn more than 9,000 net and gross acres of oil and gas leasehold interests surrounding the Well by drilling and completing additional productive wells on the acreage. The area is covered by a modern, proprietary 3D seismic survey.\n \nPursuant to the HOA, Regency will carry its US partner for a 25% working interest in the completion of the Well and the next two wells drilled on the surround...