North American Petroleum to acquire 35% Interest in Shoats Creek, Louisiana

North American Petroleum to acquire 35% Interest in Shoats Creek, Louisiana

North American Petroleum Plc, a company focussed on developing its interests in proven US onshore oil and gas formations, is pleased to announce that it has entered into an agreement with Northcote Energy plc (`Northcote’) to acquire a 35% working interest in the producing 1,670 gross acre Shoats Creek Field (`Shoats Creek’ or `the Project’), Louisiana, (`the Acquisition’). The Acquisition, which is subject to Northcote finalising its purchase of a 70% working interest in Shoats Creek, is in line with the Company’s strategy to rapidly build net production and reserves through the acquisition and development of leases in liquids rich hydrocarbon plays.
Key Highlights
* 35%/26.25% working/net revenue interest to be acquired in Shoats Creek which was originally developed in the 1950s and 1960s and has historically produced primarily from the Cockfield formation
* Includes two vertical wells producing from the Cockfield Formation that hold the leases by modest production
* 22 existing well bores provide significant low cost development potential via workovers and recompletions to both existing and new payzones
* 3D seismic data has identified new drill targets in multiple formations including the Cockfield, the Frio and Wilcox which Northcote as operator will look to potentially drill in 2015
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+ Midstates Petroleum (NYSE: MPO) is successfully developing the Upper and Lower Wilcox on leases less than half a mile of Shoats Creek
* Acquisition of 35% interest to be settled by US$175,000 upfront cash payment and via a production payment of US$10 per barrel of oil up to a maximum of US$1.575million to the original vendor
* Net leasehold position increased by 584 to 2,107 mineral acres in Oklahoma and Louisiana
NAP’s Managing Director Stefan Olivier said, “Shoats Creek will be our first project outside of Oklahoma, but as with our other projects it is held by production and has significant low cost, high impact development potential including workovers of existing wellbores as well as new drilling targets in multiple payzones identified from 3D seismic. Subject to the closing of the transaction, Shoats Creek will significantly add to our growing inventory of new wells and workover/recompletion opportunities. Further updates on our progress will be provided in due course as we look to deliver on our objective to rapidly build production, prove up the reserves on our leases and in the process generate value for our shareholders.”

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