FSNR >>> HUGE NEWS!
Freestone Resources, Inc. (FSNR.PK) Releases Carroll Unit # 1 Production Statistics
The final 72 hour production evaluation of the Carroll Unit # 1 was completed November 4, 2006 after the initial flow back period which began October 30. At current production levels and using today's prices, the Carroll Unit # 1 will produce an approximate net yearly profit of $1,040,688.00 for Freestone Resources shareholders. However, due to past well history and our consultant's analyses, we feel confident the production of oil and/or gas will eventually increase as the well is allowed to clean out over the extended flow-back period. Freestone has began negotiations with the contiguous mineral owners and have approximately 5000 acres available to lease and produce, and will diligently pursue this acreage over the following days, as verbal agreements with the mineral owners have already been made.
The well increased its oil production from 29 barrels of oil per day to an average of 39 barrels of oil per day. Water production dropped from 40 barrels of water per day to an average of 19 barrels of water per day. Natural gas production stabilized at an average of 270,000 MCF/day, while the wellhead pressure averaged about 300 PSI on an 18/64 inch choke with fluctuations from 200 PSI to over 2000 PSI.
Freestone Resources has employed a production consultant that is very experienced in the Freestone County gas play and has implemented a conservative production strategy for this well. Due to the depth and age of the well, its unique conformation, and the fact that it is still producing drilling fluids used in 1998, our consultant feels that an increased flow-back period would not only yield a more realistic gauging of the well potential, but would also allow Freestone Resources to begin generating an income stream immediately from oil sales. As of the date of this press release, Freestone Resources has 380 bbls of oil and condensate in a storage tank on site which should be sold next week for an approximate net value of $18,240.00 from the Carroll Unit # 1.
The next step involved in producing the Carroll Unit # 1 involves the construction of a production pipeline for the sales of natural gas. Freestone Resources will purchase a gas separator unit, meter run, 900 feet of newly laid 4 inch production line, and the purchase of an unused 3900 foot, 4 inch production line from an adjacent well. The entire 4 inch pipeline will be approximately 4800 feet long and will connect into a 6 inch sales line. The pipeline from the Carroll Unit # 1 to the sales line will be wholly owned by Freestone, and may be used to produce other wells drilled in the future.
Freestone Resources would also like to announce that we are in the final stage negotiations of a marketing agreement to become the distributor for a new and previously unavailable oilfield chemical line. This chemical line is the most innovative and effective group of solvents that our company or our contacts have ever discovered. The line revolves around a unique solvent which is designed to be used as a paraffin or asphaltine dispersant, emulsion breaker, corrosion inhibitor, cutting oil, and anti-sludge agent. The implementation of this product line in the oil and gas industry could yield a huge increase in production efficiency and profitability in wells produced by our customers in addition to wells owned by Freestone Resources. However, there are multiple potential uses for these products in every stage of oil and gas production and we are working with several chemists and petroleum engineers to explore these avenues. Freestone Resources directors expect to have the final draft of this agreement signed and have an in depth disclosure of the product line and agreement terms complete within the next 10 days. Once the contract is signed Freestone Resources will disclose all information by way of a press release and will add an additional page to our web site for investors and customers to learn more.
SAFE HARBOR STATEMENTS:
Certain statements in this news release may contain forward-looking information within the meaning of Rule 175 under the Securities Act of 1933 and Rule 3b-6 under the Securities Exchange Act of 1934, and are subject to the safe harbor created by those rules. All statements, other than statements of fact, included in this release, including, without limitation, statements regarding potential future plans and objectives of the company, are forward-looking statements that involve risks and uncertainties. There can be no assurance that such statements will prove to be accurate and actual results and future events could differ materially from those anticipated in such statements.
Freestone Resources, Inc.
Lloyd Lane, 903-389-8817
info@freestoneresourcesinc.com
Source: Business Wire (November 10, 2006 - 10:11 AM EST)
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