Blackbird Energy enters into farm out agreement at its Mantario oil project
CALGARY -- Blackbird Energy (Blackbird) reported that is has entered into a Farmout Agreement (the Agreement) with a private oil and gas investment company (PrivateCo) to drill the first two horizontal wells at Blackbird' s Mantario Oil Project (the Project). Blackbird also is pleased to give an update on its operations pertaining to its Elmworth Montney Acreage.
Mantario Farm Out Agreement
Under the terms of the Agreement, PrivateCo will pay an aggregate of approximately $1,600,000, or 100% of the costs to drill, complete and equip two horizontal wells with a minimum of 600 m of horizontal length, in order to earn a 50.0% working interest in the Project. There is no payout being offered with respect to this agreement.
In addition to the capital commitments noted above, the Agreement also provides for the cash payment by PrivateCo of an aggregate of approximately $200,000 for land acquisition costs and data incurred by Blackbird in respect of the subject lands. Blackbird will be the operator for the project.
Blackbird and PrivateCo expect to commence drilling operations at the beginning of Q4 2014 subject to rig availability.
Garth Braun, CEO of Blackbird noted "We are very pleased to be bringing in a financial partner to our Mantario Oil Project that will not only accelerate the development of our oil discovery in Saskatchewan but will also allow Blackbird to add further focus to the development of its Montney acreage at Elmworth."
Elmworth Montney Update
In the Elmworth area Blackbird has a total of 31 sections (19,840 acres) of Montney rights (27 contiguous sections). Blackbird has surveyed its first surface location that will be used to target the upper and middle Montney formation. Blackbird is currently in the process of licensing its first well targeting the upper Montney.