Category: News Releases Petrostar to acquire 160 acres in Saskatchewan
Letter of Intent Signed with Brahma Resources to Acquire 100% Lease Interest
Petrostar Petroleum Corp. has provided information on the following new venture.
Letter of intent signed
The company has entered into a letter of intent with Brahma Resources Ltd. of Lloydminster, Alta., to acquire a 100-per-cent interest in a freehold leasehold located near Maidstone, Sask. The lease contains a non-producing well in 101-07-15-48-24W3M with all production facilities in place. The lease is 160 acres in size allowing for the drilling of three additional wells on the property. Drilling will commence as soon as permitting and establishment of surface lease requirements for the well site are received. The initial well is to be located in A8-15-48-24W3M offsetting a well owned and operated by Husky Oil. The current non-producing well will be the subject of Petrostar’s DHT (down-hole tool) technology and will be re-entered and equipped with Petrostar’s new second-generation, more powerful DHT unit which is expected to be available for this location next month. Under the terms of the agreement, Petrostar will advance the sum of $185,000 to Brahma for a 100-per-cent ownership in the lease subject to burdens of a 2-per-cent gross overriding royalty (GORR) to Brahma and 4 per cent to Baytex Resources. The closing is expected to take place on or before Sept. 30, 2007. More details of the drilling and re-entry programs will be forthcoming as these matters proceed.
Maidstone drilling program
The company has received, from its engineering consultant, Calco Geological & Engineering of Calgary, Alta., a recommendation to drill a Waseca A & B sand well to be spudded at its A16/6 location and drilled to a depth of approximately 520 metres. The new well will be structurally higher then the offsetting wells, 1-07-48-23W3M and A13-05 owned, respectively by Rife Resources and Harvest Energy. These wells have been on production for approximately five years and are still making 15 to 16 cubic metres (94 to 100 barrels of oil per day (bopd)). Petrostar’s anticipated production from both the A & B Sands is a possible 30 cubic metres (188 bopd). Permitting and other regulatory approvals will be applied for immediately with drilling to commence as soon as possible after approvals are received.
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