Stratex Oil & Gas Holdings Enters Into Eagle Ford Shale Joint Development
WATERTOWN, CT -- (Marketwired) -- 12/10/13 -- Stratex OIl & Gas
Holdings, Inc. (OTCQB: STTX) ("Stratex" or "the Company") announced
today that it entered into a Joint Development Agreement (the "JDA")
with Eagleford Energy, Inc., ("Eagleford") and its wholly owned
subsidiary, Eagleford Energy, Zavala Inc. ("Eagleford Zavala").
Pursuant to the JDA, Eagleford Zavala granted Stratex the exclusive
right to operate and develop approximately 2,549 leasehold acres
under a certain Lease, located in Zavala County, Texas, situated
within the established oil rim of the Eagle Ford Shale play.
Eagleford Zavala has a 100% working interest ("WI") and a 75% net
revenue interest ("NRI") in the Lease.
Pursuant to the JDA, on or prior to March 31, 2014, the Company has
agreed to complete, or cause to be completed, the hydraulic
fracturing of the Matthews #1H well, and to pay all future costs
associated therewith. Eagleford originally drilled the Matthews #1H
in October 2010. Under the terms of the JDA, Stratex intends to
initiate the fracture stimulation ("frac") and completion of the
well, at an estimated cost of up to $2.0 million. Stratex will pay
100% of those costs, in return for a 66.67% WI, and a 50% WI after
payout. The JDA further provides that, following the timely
fracturing of the Matthews #1H, the Company shall have earned and be
entitled to receive an assignment of an undivided 50% working
interest in the entire 2,549 acres. As consideration for the rights
granted to the Company under the JDA, Stratex agreed to pay $300,000
as follows: (i) $150,000 was delivered on December 4, 2013 to the
lessors under the Lease, on behalf of Eagleford Zavala, (ii) $50,000
was delivered to Eagleford on December 4, 2013 and (iii) $100,000
will be delivered to Eagleford on or before December 31, 2013. The
consideration was funded utilizing cash on the balance sheet.
The Matthews #1H was originally drilled to a total measured vertical
depth of 8,500 feet, of which more than 5,100 feet was vertical depth
into the Buda formation, which sits directly below the Eagle Ford
Shale. The well was then whipstocked at the top of the Austin Chalk,
directly above the Eagle Ford Shale, and drilled with an 800 foo
curve into the Eagle Ford Shale. Subsequently, a 3,300 foot lateral
through the Eagle Ford was drilled in order to more efficiently
exploit the reservoir. A shot point sleeve from Baker Hughes was
installed to protect the wellbore and accommodate a multi stage frac.
The Matthews #1H was extensively logged, and 36 sidewall cores were
taken from 4 formation, including (in descending order) the San
Miguel, Austin Chalk, Eagle Ford, and Buda. The logs were then
interpreted by Weatherford International, Ltd., and the sidewall
cores were analyzed by Core Laboratories and Weatherford.
Subsequently, Ryder Scott Company, LP utilized the information, as
well as other data, to prepare an evaluation of the recoverable
contingent resources associated with the discovered petroleum
initially in place in the Eagle Ford Shale.
The Lease is also highly prospective for other locally prolific
zones, including the Austin Chalk and Buda, as well as the San Miguel
(heavy oil). Local operators in the Eagle Ford are successfully
exploiting the oil in place utilizing horizontal drilling and
multi-stage hydraulic fracs on 60 to 80 acre spacing units. On this
basis, Management believes there are up to 42 horizontal drilling
locations in the Eagle Ford formation alone. Eagleford Zavala
indicates 14 horizontal locations for the Austin Chalk and 32
horizontal locations for the Buda have also been mapped, with
additional locations possible. In addition, there is significant
heavy oil in place in the San Miguel formation. Stratex is
considering various enhanced recovery methodologies, which could
include waterflood or steam injection. Stratex intends to
aggressively exploit the Lease following the timely frac and
completion of the Matthews #1H.
The Eagle Ford Shale is one of the largest unconventional resource
discoveries in the Lower 48 over the past 40 years, boasting a high,
rich organic content shale. The play underlies much of southeastern
Texas, covering a region previously known geologically for high
quality multi-stacked pay. Rapidly increasing output from the Eagle
Ford Shale currently accounts for approximately 25% of total Texas
oil production of 2.5 million barrels per day, and is expected to
surpass 1 million barrels per day in the very near future.
Stephen Funk, Chairman and CEO, stated, "Stratex is very pleased to
have the opportunity to frac and complete the Matthews #1H and to
drill the entirety of this high quality acreage, located in one of
the most actively drilled areas of the United States. Stratex now has
a formidable drilling inventory of high quality stacked locations,
which we believe will enable the Company to raise additional capital
in order to meaningfully increase proved reserves, production, and
cash flow, which in turn should be highly accretive to shareholder
value. We will aggressively commence the exploitation of our core
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About Stratex Oil & Gas Holdings, Inc.
Stratex is an independent energy company focused on the exploration,
acquisition, and production of crude oil in the Bakken and Three
Forks formations in North Dakota and Montana. Its oil and natural gas
operations are primarily concentrated in two Rocky Mountain basins,
the Williston Basin of North Dakota and Montana. Stratex's corporate
strategy is to internally identify prospects, acquire lands
encompassing those prospects, and evaluate those prospects using
subsurface geology and geophysical data. Using this strategy, Stratex
has developed an oil portfolio of proven reserves, as well as
development opportunities on high potential oil prospects.
Stratex's core operating areas are the Williston Basin in North
Dakota and Montana, and the Denver-Julesburg Basin in Colorado. In
the Williston Basin, Stratex focuses on oil production from multiple
zones including the Bakken Shale and Three Forks Sanish Formations.
In the Denver-Julesberg Basin Stratex focuses on the Niobrara and
Stratex engages geologists, petroleum engineers, and geophysicists
with years of relevant industry experience in the basins w
Company operates. Stratex strives to retain operations on its lands
wherever possible in order to control the timing of the development
of its leasehold. For more information visit:
This press release contains forward-looking statements within the
meaning of the Private Securities Litigation Reform Act of 1995 (the
"Act"). Additionally, words such as "seek," "intend," "believe,"
"plan," "estimate," "expect," "anticipate" "project" and other
similar expressions are forward-looking statements within the meaning
of the Act. Some or all of the events or results anticipated by these
forward- looking statements may not occur. Factors that could cause
or contribute to such differences include the ability of Stratex Oil
& Gas to attract customers for its services, and to continue
developing its oil & gas assets. Further information on Stratex's
risk factors is contained in its filings with the Securities and
Exchange Commission, including the Form 8-K filed in connection with
the Merger. Stratex Oil & Gas does not undertake any duty nor does it
intend to update the results of these forward-looking statements.
WSR Communications, Inc.
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