EYTC -- Energytec, Inc.
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Energytec Updates East Texas Project Sales Efforts; 2006 Operating Plan Under Way
DALLAS, Jan 11, 2006 /PRNewswire-FirstCall via COMTEX/ -- Energytec, Inc. (OTC Pink Sheets: EYTC) announced today that it has received several expressions of interest and invitations to negotiate the sale of certain of its East Texas Projects during the last quarter of 2005. Two offers have been made and are being reviewed by Management.
Chairman and CEO Frank W Cole said, "We are pleased with the level of interest in our Trix-Liz, Sulphur Bluff and Redwater Projects as represented by the due diligence efforts and these offers. However, we began this process with certain objectives in mind both as to the total sales consideration and specifically the amount of cash consideration. For example, every well we have drilled in Trix-Liz since 2003 is a successful producing well. There are 25 additional wells to be drilled there, nine for our partners and 16 for our own account. In addition to sales of oil, we are close to beginning gas sales in Trix-Liz for the first time. As a result, we placed a value on that Project to which we remain committed."
Chairman Cole continued, "Similarly, our efforts in Sulphur Bluff are resulting in drilling successes. We have drilled three new in-fill wells. They are all from various intervals in the Paluxy Formation, and both gas and oil are present in commercial quantities. These results are being evaluated, and we see continuing validation of the reasoning behind purchasing this field. At Redwater, we have begun remediation work on several of the existing wells and a new exploratory well will spud this month. Our new drilling rig, Rig Number 15, has been newly refurbished and has completed its first drilling assignment. It will now move to Redwater for a continuous drilling program for most of 2006.
"Even as we evaluate the offers, we nonetheless are moving ahead with our 2006 operating plan. This plan envisions a capital budget in excess of $25,000,000 involving 30 new wells, 24 work-overs, 10 dual completions in Trix-Liz, and various other projects to increase our production and output to record levels of oil and gas revenues in 2006. As a result, our intentions remain to sell one or more projects, but only if the cash consideration and other terms are acceptable. If the offers are not acceptable, we will continue to build the Company through production growth and selective acquisitions currently being evaluated. We have engaged experienced oil and gas investment advisory support to support the sales effort but we will not short-change our stockholders by leaving money on the table when we know the realizable value of our properties."
Chairman Cole further announced that the Company's Wyoming Project spin- off plan is being finalized, and that details are expected to be forthcoming in an announcement before the end of next week.
ABOUT ENERGYTEC
Energytec, Inc. is a growing independent oil and gas company based in Dallas, Texas principally engaged in acquisition and development of mature fields with established oil and gas reserves that have declined in production yet still possess significant remaining upside exploitation potential. Its operations are focused primarily in four areas of Texas (Northeast, East, Central and South Central) and secondarily in Wyoming in the Big Horn Oil Field, where it is undertaking a significant thermal recovery project. Energytec has increased production and reserves on the properties it owns and intends to continue to increase production and reserves on those properties, as well as new acquisitions, through drilling new wells, and implementing other development programs such as workovers and secondary recovery operations. The Company maintains a website at http://www.energytec.com . For further information, call Frank W Cole, Chairman of Energytec, at 972-789-5136 or email the Company at energytec@energytec.com.
The statements in this document concerning management's plans and objectives including those related to the number of wells to be drilled in Trix-Liz, the inception of gas sales in Trix-Liz, drilling successes in Sulphur Bluff, the 2006 drilling program in Redwater, the capital budget of $25,000,000 for 2006, growth through production and selective acquisitions, finalization of the Wyoming Project spin-off, and the realizable value of our properties constitute forward-looking statements pursuant to the safe harbor provision of the Private Securities Litigation Reform Act of 1995. These statements involve risk and uncertainties that could cause actual results to differ materially from those set forth in these statements. Factors which could cause or contribute to such differences include, but are not limited to the ability to obtain drilling permits in a timely manner, the ability to utilize our own equipment and manpower or to procure third party services to drill exploratory and development wells and to complete workovers, thereby increasing production necessary to attain growth, the ability to generate capital to meet the capital budget, and other economic factors which could affect demands for natural gas as well as commodity prices, factors detailed in the Company's Report to Shareholders; down-turns in the Company's primary markets; disruption to the Company's operations from acts of god or extended maintenance; and production and transportation difficulties. The realization of any of these risk factors would significantly impact the company's ability to achieve the 2006 operating plan and any growth anticipated by management. Accordingly no assurance can be given that events or results mentioned in any such forward-looking statements will in fact occur. Energytec, Inc. assumes no obligation to update this information.
SOURCE Energytec, Inc.
CONTACT: Frank W Cole, Chairman of Energytec, Inc., +1-972-789-5136, or
energytec@energytec.com
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