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Energy Resources Corp. signs LOI to buy Oil and gas property in Kentucky.
April 28, 2011
Dateline: Vancouver, BC April 28, 2011 Energy Resources Corp. through its established GP, Kentucky Petroleum Operating Ltd announced today that it has signed a Letter of Intent (LOI) to acquire a 1400-acre oil and gas property located in Laurel County, Kentucky.
According to the LOI, the general partner of the fund “Kentucky Petroleum Operating Ltd.” will acquire the North Laurel property located in a well-established oil and gas production area in East Kentucky. A third party engineering report estimates Proven oil reserves of 1,350,000 Bbls and Proven gas reserves of 7.35 Bcf.
The property contains 6 PDNP wells (Proven Developed None Producing), 10 PUD wells (Proven Undeveloped) and the Company has an additional 25 Probable locations on the acreage it is acquiring for future development. To date there has been a 100% success rate on finding oil and gas on the property. Under the terms of the LOI, Kentucky Petroleum Operating Ltd will acquire the property for a price of $1,145,000, paid for in cash and promissory notes.
"Our LOI is aligned with our new strategy to focus on opportunities within the oil and gas industry," said Mehran Ehsan, president of Energy Resources Corp. "We plan to acquire natural resource properties that contain already producing wells or those that can be brought into production in the near-term with minimal capital requirements in known producing areas. We believe the timing is right to acquire oil and gas wells at a discount to the market, and then turn them into productive, cash-generating assets for the benefit of our Investors and limited partners."
The company said it has taken a major step forward in executing its strategy by now securing a second oil and gas property with historically confirmed production for its portfolio of projects, and sees this as a catalyst for further expansion.
Kentucky Petroleum Operating Ltd
Kentucky Petroleum Operating Ltd. (KPO) is an incorporated entity under the management of Energy Resources Corp. KPO sole responsibility is to be the general partner for the “Kentucky Petroleum Limited Partnership” and associated properties under the LP fund.
Disclaimer: Except for historical information contained herein, the matters set forth above may be forward-looking statements that involve certain risks and uncertainties that could cause actual results to differ from those in the forward-looking statements. Words such as “anticipate,” “believe,” “estimate,” “expect,” “intend” and similar expressions, as they relate to Energy Resources Corp. and Kentucky Petroleum Operating Ltd., the potential reserves, production and ability to establish wells on the Prospect, identify forward-looking statements. Such forward-looking statements are based on the current beliefs of management, as well as assumptions made by and information currently available to management. Actual results could differ materially from those contemplated by the forward-looking statements as a result of certain factors such as the nature of business negotiations, the operational details of oil and gas properties, the competitive environment within the industry, the ability of Energy Resources Corp. and Kentucky Petroleum Operating Ltd. to expand its operations, the level of costs incurred in these expansion efforts, economic conditions in the industry and Energy Resources Corp / Kentucky Petroleum’s financial strength. Energy Resources Corp and Kentucky Petroleum Operating Ltd. do not undertake any obligation to update such forward-looking statements. Investors are also directed to consider all other risks and uncertainties.