OMDA Oil and Gas, Inc. Reports That Drilling Permit Has Been Issued on Initial 6,000 Ft. Test Well on 800 Acre Patroon Prospect
Friday May 27, 11:17 am ET
Also Gives Drilling and Legal Update
HOUSTON--(BUSINESS WIRE)--May 27, 2005--OMDA Oil and Gas, Inc. (OMOG), an oil and gas production company (OTC.PK:OMOG), through its Chairman, Adam Barnett, announced today that it has received notice from the well operator, Texas Land & Petroleum Company (TLPC), that the Texas Railroad Commission (TRRC) has issued a Drilling Permit for the initial test well on an 81 acre unit of the 800+ acre prospect. A copy of the plat map and drilling permit has been posted on the OMDA website located at http://www.omogoil.com/projects.html . The TRRC is the Texas State Agency that oversees all Oil and Gas Production in Texas. Now that the drilling permit has been received, TLPC will meet with the surface rights owner, International Paper Company as to the disposition of its trees on this heavily wooded location as we prepare the roads and location. It is anticipated that this will take approximately two weeks after which the pits will be dug in final preparation for moving in the actual drilling rig. If no problems are encountered, either by TLPC or the Rig Owner, drilling should commence by the end of June and take approximately 10-12 days to reach testing depth.
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On April 26, OMDA signed a Participation Agreement with Texas Land & Petroleum Company, LLC, of Wylie, TX to acquire a 15% working interest in their Patroon Field Prospect, Mooringsport test, Shelby County Texas (James Rowe, Abstract 585). The following was reported in a PR that day, "While not a wildcat per se as no wells have been drilled directly on the lease, the prospect is up-dip to a Northeast, Southwest fault line and directly offsets a well that was drilled and completed in 1948 by Humble Oil. The Humble #1-C Pickering well was tested in two of three Upper Glen Rose/Mooringsport zones totaling 60' of pay, and completed in one with 28' of pay. The lower zone at 5272'-5290 test at 1,758 mcf/d and 135 barrels of oil per day (bopd). Since the nearest gas line was a hundred miles away at that time, this zone was never produced. The next Mooringsport up the hole at 5,164'-5192' tested at 1,204 mcf/d and 109 bopd and was completed and produced for approximately 18 months, totaling around 15,000 barrels of oil while flaring the gas. The well was subsequently abandoned due to the very low price of oil and lack of gas value in 1950."
At the time OMDA published the above, it was anticipated to take the well down to the 5,300 ft. level and just test the three Mooringsport levels. However, after further discussion with the Geologist and Petroleum Engineer, the Partners in the well are now considering taking the hole down to the 6,000 ft. level and check out the "Massive Anyhydrite" (Ferry Lake) which showed some interesting "kicks" in the old Humble well.
The Patroon Prospect that OMDA is participating in covers 800+ acres and will, if successful, support 5-6 wells on 160 ac. spacing units, and 8-10 on 80 ac. Units. TEC Engineering Group, Inc. estimates recoverable gas reserves per 80 ac. unit of 1.226 Billion Cubic Feet, and oil of 36,000 barrels. Should TEC's estimates be correct, the gross potential on the 800 acres at the current price of Gas and Oil could exceed $100 million over the life of the project.
Along with the recently received Drilling Permit and initial well plat map, a package with maps and documents can be found on the Company's website at this address: http://www.omogoil.com/projects.html
Adam Barnett, Chairman stated, "As I mentioned in our initial PR on this prospect, we have been looking at the Patroon Prospect since late last year. Luckily due to a dearth of drilling rigs, this well that was originally supposed to have been drilled by year end, but due to the lack of rigs, had some availability free up. What really ups our confidence in this well is that the operator, TLPC, is taking a large paid interest in the well along with their traditional "third for a quarter" carried interest." Barnett went on to say, "This may or may not be our first new drilling participation since I gained control of OMDA under adversarial conditions in late 2003. As I mentioned in our last PR on Patroon, we were also looking at a couple of additional prospects. As this is being released, one of our Consultants is 'on location' meeting with an operator about our potentially participating in an out of state six well shallow oil and gas play. Should we elect to participate, and that decision will probably be made in the next week, drilling would be immediate." Regarding Panola, Barnett stated, "I have elected to continue to place this exciting project on hold due to the large amount of capital (up to $7 million) that will be needed to commit once drilling begins. Since we control the whole play and have no pressures to drill at this time and once we do commence drilling we would like to retain a larger interest than originally anticipated when we took it on, I see no reason to hurry this one up."
Additionally Barnett stated, "Once again, I really do appreciate the patience of our shareholders as we continue to advance the restructuring of our Company which began 20 months ago when I gained control of the company under adversarial conditions as mentioned above. It has been a remarkable 20 months as your Management and Consultants have attempted to ascertain with little or no help from prior management, just what assets OMDA really has. As most know, some seven weeks ago management came to the conclusion that prior management may have mishandled a considerable amount of Company assets and therefore elected to bring legal action against prior management and certain consultants. The proof of the prudence of bringing this action has already been shown by the quick and very beneficial settlement that your company received just four days ago on the Concorde Dome 12 well workover project. An asset that just a month ago was not even contemplated as being in reach. It appears that this is just the 'tip of the iceberg' as all will see next week when Company counsel sets a personal precedence and files a much expanded 'First Amended Pleading', even before Deposition and Discovery begins."
About OMDA Oil and Gas, Inc.
OMDA Oil and Gas, Inc and its wholly owned subsidiaries, OMDA Oil & Gas Management, Inc and Texas OMDA Drilling & Operating, Inc are in the business of oil and gas production and lease acquisition. Currently the Company owns average participation interests approaching 47%, in 355 producing and non-producing oil and gas wells in Louisiana and Texas, as well as 100% gross interest in an undeveloped 1,116 acre, horizontal play in the Panola Field, Panola County, Texas. Current projects include a 15% working interest in an 800+ acre play in Shelby County, TX and a Carried back-in working interest of at least 7.5% up to 37.5% in a 12 well workover play in the Concorde Dome Field in Andersen County Tx.
This release includes forward-looking statements made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995 that involve risks and uncertainties including, but not limited to, the impact of competitive products, the ability to meet customer demand, the ability to manage growth, acquisitions of technology, equipment, or human resources, the effect of economic and business conditions, and the ability to attract and retain skilled personnel. The Company is not obligated to revise or update any forward-looking statements in order to reflect events or circumstances that may arise after the date of this release.
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Contact:
OMDA Oil and Gas, Inc.
Adam Barnett, 305-609-2345
omoilandgas@aol.com
www.omogoil.com
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