Aurex Energy Corp. today announced that it has signed a letter of intent to enter into a joint venture, with a private arms-length third-party.
Aurex Energy Corp. (“AURX” or the “Company”) (TSXV:AURX) today announced that it has signed, through its wholly-owned US subsidiary, a letter of intent (“LOI”) to enter into a joint venture (“JV”), with a private arms-length third-party (“JV Partner”), to re-work a number of natural gas wells located in the Barnett Shale, Fort Worth basin, Texas, USA.
The LOI sets out the framework for a definitive JV agreement to be finalized between the parties as soon as possible. The JV Partner will contribute US$2.5 million to the JV to re-work shut-in natural gas wells, bringing them back into commercial production. The joint venture revenue sharing and operating details will be disclosed when the JV agreement is signed.
The Company’s primary property (held in the wholly-owned US subsidiary) consists of 10 shut-in natural gas wells (8 horizontal wells and 2 vertical wells) on 1,400 acres located in the Fort Worth Basin. Total Proved Plus Probable Reserves are 24.6 Billion Cubic Feet (“BCF”) of natural gas. The estimated Net Present Value (“NPV”) of the net revenue (after all operating costs, royalties and taxes) from the Proved Plus Probable Reserves, using forecast pricing, is US$22.0 million. Peak operating cash-flow (before income taxes), after reworking all wells, is estimated at US$10.8 million per year. Estimated reserves and economic valuations are from a NI51-101 report titled “Appraisal Of Certain Oil And Gas Interests located In Hill, Hood, Parker And Tarrant Counties, Texas As Of January 1, 2019” prepared by a Qualified Reserves Evaluator (“QRE”), MKM Engineering, for Canadian Platinum Corp. (now Aurex Energy Corp.) and dated December 28, 2018.
As discussed in a news release dated July 5, 2019, the initial phase of work will focus on five of the ten wells: one vertical and four horizontal wells. The JV will form part of this initial program.
Gary Billingsley, President, comments “Aurex is pleased to have found a partner to contribute the capital to complete part of the initial work program. This allows us to work towards our goal of achieving near-term cash flow to continue to develop and expand the project, including increasing the scope of our joint venture activity.”
About Aurex Energy Corp.
Aurex Energy Corp. is a Canadian-based resource exploration and development company with its head office in Saskatoon, SK. Aurex is focused on the acquisition and development of a diversified portfolio of resource properties critical to current and future energy production. This includes natural gas for LNG, base metals including copper and zinc, platinum group elements, strategic metals including cobalt, and precious metals.
AUREX ENERGY CORP. TRADES ON THE TSX VENTURE EXCHANGE UNDER THE SYMBOL “AURX”.
For more information, including news releases and technical reports providing more detail on the contents of this news release, please visit our website at www.aurexenergy.ca
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Aurex Energy Corp.
Gord Dent, Manager Investor Relations
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