Petrosearch Energy Provides Update on Waterflood Project
Thursday January 10, 10:21 am ET
HOUSTON--(BUSINESS WIRE)--Petrosearch Energy Corporation (OTCBB:PTSG - News) announced today that all the agreements and regulatory approvals necessary to commence its North Texas Panhandle Waterflood Project (“Project”) have been completed. A summary of these agreements is described below.
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Water Treatment Services Agreement with Complete Production Services, Inc. (“CPS”) – This agreement, among other things, provides that CPS, at its sole expense, will design and construct a water treatment facility no later than 90 days from the effective date of the agreement that will be capable of treating all of the Company’s production water up to a maximum of 10,000 bbls per day and likewise treat and provide to the Company a minimum of 5,000 bbls per day of production water from third party sources. The Company, in turn, has committed to be capable of injecting not less than 2,000 bbls of treated water per day derived from third party production water within 30 days after the facility is opened, and has further committed to be capable of injecting not less than 5,000 bbls of treated water per day derived from third party production water within 180 days after the facility opens, in addition to re-injecting its own treated production water from the oil and gas lease it operates. The Company will pay a scaled management fee to CPS commencing on the date the facility opens on the basis of the volume of treated and reinjected water derived from the Company’s production. The Company is currently applying to regulatory agencies to add more wells to the existing flood permit, as required under the agreement, to ensure our ability to inject the volumes that CPS will make available. The Company does not anticipate any difficulty with obtaining the approval.
Saltwater Treatment and Injection Agreement with the landowner – This agreement, among other things, gives the Company the exclusive right to occupy and use a portion of the surface of the property for the purpose of the installation of a salt water treatment and injection facility.
Settlement Agreement with CRMWA – As previously disclosed, the Company entered into an agreement with the landowner to drill and produce a freshwater source well on the lease which was followed by local water district approval to produce the fresh water from the regional aquifer for use in the Project. After the local water district rendered its approval, the Canadian River Municipal Water Authority (“CRMWA”) filed a protest with the Railroad Commission of Texas attempting to block the Company’s ability to obtain a Fluid Injection Permit for the Project permitting the use of freshwater for injection. Pursuant to this Settlement Agreement, among other things, CRMWA withdrew its protest of the application of the Company’s Fluid Injection Permit and the Fluid Injection Permit was thus issued by the Railroad Commission of Texas. In exchange for the withdrawal of the protest by CRMWA, the Company agreed to limitations on the amount of freshwater which would be used for injection in the Project. The agreement with CPS shall provide the primary source of injection water, but the CRMWA Settlement Agreement will facilitate the use of fresh water as a backup water source.
Richard Dole, President and CEO, stated, “By completing all of the agreements which solidify the sources of injection water for the Project, we have assured that the Project will proceed according to its technical design. We believe the solutions achieved will be a model for other companies in the industry when it comes to dealing with highly political freshwater issues typically encountered with a waterflood project of this magnitude. Completing all the necessary agreements prior to commencement of the waterflood also enables us to more readily attract any additional financing or joint venture partners before or after commencing the first stage of the Project.”
About Petrosearch
Petrosearch Energy Corporation, a Nevada corporation with executive offices in Houston, Texas, is a resource based energy company with activities focused on two major projects: the Barnett Shale trend, and the Anadarko basin of the North Texas Panhandle. For more information please visit www.petrosearch.com.
Forward-Looking Statements
Statements contained herein and the information incorporated by reference herein may be forward-looking statements within the meaning of Section 21E of the Securities Exchange Act of 1934 (the "Exchange Act"). Forward-looking statements can be identified by the use of forward-looking terminology such as, but not limited to, "may," "will," "expect," "anticipate," "estimate," "would be," "believe," or "continue" or the negative or other variations of comparable terminology. We intend such forward-looking statements to be covered by the safe harbor provisions applicable to forward-looking statements contained in Section 21E of the Exchange Act. Such statements (none of which is intended as a guarantee of performance) are subject to certain assumptions, risks and uncertainties, which could cause our actual future results, achievements or transactions to differ materially from those projected or anticipated. Such risks and uncertainties are set forth herein.
Forward-looking statements include statements concerning plans, objectives, goals, strategies, future events, or performance and underlying assumptions and other statements, which are other than statements of historical facts. These statements are subject to uncertainties and risks including, but not limited to, product and service demands and acceptance, changes in technology, economic conditions, the impact of competition and pricing, and government regulation and approvals. Petrosearch cautions that assumptions, expectations, projections, intentions, or beliefs about future events may, and often do, vary from actual results and the differences can be material. Some of the key factors which could cause actual results to vary from those Petrosearch expects include changes in natural gas and oil prices, the timing of planned capital expenditures, availability of acquisitions, uncertainties in estimating proved reserves and forecasting production results, operational factors affecting the commencement or maintenance of producing wells, the condition of the capital markets generally, as well as our ability to access them, and uncertainties regarding environmental regulations or litigation and other legal or regulatory developments affecting our business.
Our expectations, beliefs and projections are expressed in good faith and are believed to have a reasonable basis, including without limitation, our examination of historical operating trends, data contained in our records and other data available from third parties. There can be no assurance, however, that our expectations, beliefs or projections will result, be achieved, or be accomplished.
Readers are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date hereof. We undertake no duty to update these forward-looking statements.
Contact:
Petrosearch Energy Corporation
Investor Relations, 713-334-5123
IRC@petrosearch.com
or
Piedmont IR, LLC
Keith Fetter or Darren Bankston, 678-455-3696
info@piedmontir.com
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