"The Company has also entered into a non-binding Letter of Intent (LOI) to acquire interests in certain mineral leases covering approximately 8,800 acres in Regan and Irion Counties, Texas. The LOI provides that the Company will acquire a 50% working interest and a 37.5% net revenue interest in 4 recently drilled producing oil wells plus oil & gas mineral leases covering approximately 2,300 acres for an aggregate maximum purchase price of US$5,750,000. The LOI further provides that the Company will be granted an option to acquire a 50% working interest and a 37.5% net revenue interest in approximately 6,500 acres of adjacent undeveloped mineral leases on terms yet to be finalized. The final terms of the acquisition and option agreement will be set out in a definitive purchase and sale agreement, which is currently under negotiation, and is subject to financing among other things."
LOL either they are deluded or we are! Glad this deal was 'terminated' by Terrace, but why on earth would SG even entertain it at such a giveaway price? I imagine a deal like this would have decimated the SP.
Remember, we are talking about four wells that some here have estimated will flow up to 1000bopd combined, not some moose pasture dribbling 39boepd on a good day...
Frankly I'm surprised this hasn't generated much more discussion. I've no doubt we have a great lease in an oil rich part of Texas, but am beginning to wonder if management are prepared to extract full value for the benefit of the shareholders, if the above is anything to go by.
Looking ahead to the much vaunted JV, with one hairy eyeball. Get us a fair deal SJ, you know what the land is worth.
DJ
GGP Price at posting:
1.9¢ Sentiment: Hold Disclosure: Held
