TAIPAN ENTERS INTO AN AGREEMENT TO BUY A 25% WORKING INTEREST IN OIL AND GAS LEASES IN TEXAS PANHANDLE
Vancouver, British Columbia--(Newsfile Corp. - May 9, 2016) - Taipan Resources Inc. (TSXV: TPN) ("Taipan" or the "Company") is pleased to announce that it has entered into a Working Interest Assignment Agreement with Ponderosa Engergy, LLC ("Ponderosa") to purchase a twenty five percent (25%) working interest in Ponderosa's 100% working interest in fifty seven (57) oil and gas leases covering 7,314 acres located in the bifurcated Texas Panhandle (the "Transaction").
Taipan will purchase its 25% working interest for the sum of US$500,000 (the "Consideration"). In addition, Taipan will undertake to pay Ponderosa's working interest share (75%) of approved costs incurred in compliance with the terms of the joint operating agreement ("JOA") that will govern the relationship between the Company and Ponderosa in respect of the Leases, subject to a total cap of US$750,000. The closing of the transaction is subject to TSX Venture Exchange approval, satisfactory due diligence by Taipan and execution of the JOA.
Ponderosa is a Dallas based oil and gas company strategically focused on the acquisition and development of conventional oil & gas field redevelopment. Ponderosa has identified and aggregated oil assets which exhibit long economic life, shallow decline rates, and low capital investment requirements. The Company's intent is to consolidate large asset blocks in the bifurcated Texas Panhandle and produce economically in anticipation of an increase of energy prices. Upon completion of the Transaction, the Company will have a 25% working interest in 156 wellbores, of which 48 are producing.
Ponderosa will be conducting optimization operations on non-producing but existing wellbores. It will not be undertaking exploration risk or developing new wells until prices recover to levels where it would be attractive to do so. The Company will perform recompletions on the wells to place them back into production.
Taipan Resources Inc. is in the business of consolidating producing oil and gas asset blocks in stable hydro carbon producing regions. Through its wholly-owned subsidiary "Lion Petroleum Corp.", Taipan also has a 20% non-operated interest in Block 1 and a 100% operated-interest in Block 2B onshore.
CEO and Director
Taipan Resources Inc.
(604) 336 3193
NEITHER THE TSX VENTURE EXCHANGE NOR ITS REGULATION SERVICES PROVIDER (AS THAT TERM IS DEFINED IN THE POLICIES OF THE TSX VENTURE EXCHANGE) ACCEPTS RESPONSIBILITY FOR THE ADEQUACY OR ACCURACY OF THIS NEW RELEASE.
Cautionary Notes Regarding Forward Looking Statements
This News Release contains forward-looking statements. Forward-looking statements are statements that relate to future events, such as statements with respect to the Transaction and the Company's plans to consolidate asset blocks in the Texas Panhandle and recomplete non-producing wellbores. These statements are only predictions and involve known and unknown risks, uncertainties and other factors that may cause our or our industry's actual results, levels of activity, performance or achievements to be materially different from any future results, levels of activity, performance or achievements expressed or implied by these forward-looking statements. While these forward-looking statements, and any assumptions upon which they are based, are made in good faith and reflect our current judgment regarding the direction of our industry, actual results will almost always vary, sometimes materially, from any estimates, predictions, projections, assumptions or other future performance suggested herein. Except as required by applicable law, the Company does not intend to update any of the forward-looking statements to conform these statements to actual results