Victory Energy Corporation has entered into a letter of intent to acquire 181 net barrels of oil equivalent per day (BOEPD). The company expects the acquisition to result in ~77.1% - 88.6% working interest in three producing wells and ~38.6% - 44.3% working interest in 1,370 net acres that are currently held by production. Upon closing, this acquisition is expected to increase total PV-10 proved producing reserves for Victory to more than $10 million.
Transaction Highlights include:
•PV-10 increase of $8.6 million (based on Q3 2015 Macquarie Tristone Energy Lender Price Survey for WTI oil and Henry Hub gas; a supporting third party report has been initiated)
•Production of 181 BOEPD from 3 existing wellbores
•1,370 net acres currently held by production containing 4 additional proved undeveloped locations
•Production from the Woodbine formation with future development opportunities in the Lower Eaglebine, Georgetown, Edwards and Glen Rose (Buda-Rose) formations.
•Both vertical and horizontal drilling opportunities exist
•Drilling and development of the first PUD locations are anticipated to begin late 2016
•LOI includes an option for the company to acquire up to a 50% proportionally reduced working interest in acreage acquisitions within a defined AMI
•The company will maintain exclusivity with the seller through the term of the LOI