I wonder which private equity funds are ringing the phones at UPDV/HTOG now...
Press Release Source: Heartland Oil and Gas Corp.
Heartland Pursues Institutional/Private Equity Financing to Proceed with 300 Well Drilling Program
Monday June 2, 5:20 am ET
NEW YORK--(BUSINESS WIRE)--The management of Heartland Oil and Gas Corp. (OTC BB: HTOG - News) (FWB: HOCA) recently initiated contact with institutional investors/private equity funds that specialize in oil and gas exploration and production and pipeline construction. These discussions have focused on the development of at least 300 wells over the next 12 to 24 months.
In preparation for these discussions, Heartland previously developed gas-in-place-maps and identified 300 drilling locations in its Southeast Kansas area of operation. Heartland also obtained reports from its consulting petroleum engineers establishing reserve projections for the 10 year production life of each of these wells at 0.1BCF (100,000 MCF). At current natural gas prices of $12/MCF, this means that every well should produce $1.2 million over the life of the well.
Based on Heartland’s experience and knowledge obtained as a result of drilling and completing 21 wells, an injection well and building a 4 ½ mile pipeline, 99% of all wells drilled and completed in the Cherokee Basin produce gas in commercial quantities and the cost of each well on a turnkey basis including pipelines, flow lines and an injection well for every thirty producing wells is $130,000.
Heartland currently operates 38 wells in Miami County, Kansas, recently drilled and producing under this valuation formula. With the drilling of 300 additional wells at a total cost of $39 million, Heartland’s revenues should continue to grow at this rate or more in the ten years following completion of this expansion program.
“These numbers represent only the organic growth projected for our Kansas operations,” reports Heartland Spokesman Jack Baker. “Heartland also has significant properties in Texas that currently generate even more revenue. Based on these numbers and on the limited number of shares issued and outstanding on a fully diluted basis, we are very optimistic about the prospects for expanding shareholder value.”
