mccormack road OPL has announced an increase in its holdings of...

mccormack road OPL has announced an increase in its holdings of the recent McCormack Rd to 50%.

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Orchard Increases Interest at McCormack Road/Northwest Rio Vista
Orchard Petroleum Limited (ASX; OPL) (Orchard) and Orchard Petroleum Inc. (OP Inc), a
wholly owned subsidiary of Orchard are pleased to announce that OP Inc. has increased its
working interest position at the McCormack Road 1-15 well where a new gas discovery was
announced earlier this month.
In addition, we are pleased to announce that OP Inc. has also increased its working interest in the
Northwest Rio Vista prospect area surrounding the 1-15 discovery well, both of which are part of
the Southern Sacramento Basin of California. .
OP Inc. has increased its share of production revenue in the McCormack Road 1-15 gas well
from 25% to 50% which is expected to go into commercial production within the next 30 days.
OP Inc. has also increased its working interest in the Northwest Rio Vista prospect area from
25% to 37.5%. The leased area covers approximately 318 acres and is covered by 3-D seismic
which is available for analysis in determining future drilling prospects.
The increase in working interests was acquired from the Nahabedian Exploration Group, LLC
(“NEG”) in exchange for certain exploration credits OP Inc has had with NEG from earlier
agreements. Hence there is no cash outlay by the company on this transaction that is expected to
yield net cash flows to OP Inc in the very near future.
Executive Chairman Steve Graves said, “ Since our entry into California one of our major target
areas has been the very prolific gas producing area of Rio Vista. The increase in production
revenue from the 1-15 gas well along with the strategic ally placed acreage gives us a two-fold
benefit”. In addition, under OPL assumptions the revenue base from just this one well will
deliver over A$1 million per year which is expected to more than cover our overheads.”
“Appraisal drilling opportunities currently being investigated in the area may lead to additional
drilling on the discovery. At $6.50 gas prices, this provides a very large upside”
The participants in North West Rio Vista area are as follows:
· OP Inc 37.5%
· Nahabedian Exploration Group 37.5%
· Matris Exploration Group 25%