Kodiak Energy, Inc. and Subsidiary Cougar Energy, Inc. Announces Closing of Property Acquisitionadmin
Kodiak Energy, Inc. announces that its majority controlled subsidiary, Cougar Energy, Inc. (Cougar), has closed the property acquisition previously announced on August 11, 2009 consisting of wells, facilities and production from a private company with operations in and adjacent to the CREEnergy project. Additional information on the property acquisition is on our website at http://www.kodiakpetroleum.com/s/AdditionalProjects.asp.
The acquisition adds 2 producing wells, 4 suspended wells, and associated production facilities. The existing wells and reserves are located in the Kidney and Equisetum fields. Current gross production is approximately 20 barrels of oil per day. Based on the April 1, 2009 engineering report provided by the private company, the estimated Proved and Probable oil reserves are CAD$459,000 (net present value – 10%). Cougar will update the reserve report information as soon as possible.
This acquisition is funded with CAD$100,000 cash paid in installments over 18 months and the issuance of 155,000 common shares of Cougar at CAD$1.30 to the private company. The shares are subject to a two year escrow agreement.
Mr. Bill Tighe, CEO of Cougar, states, “We are excited about closing this acquisition and it is a strategic step for Cougar being able to commence active development in this core area, achieve timely production and cash flow. We have already started to advance our plan to build upon overall area production, infrastructure; provide substantial upside in workovers, secondary developments and drilling; along with the required financing. Cougar will be actively working this fall and winter to maximize those opportunities and increase production and thus revenue.”
The issuance of shares is subject to final approval of the TSX Venture Exchange.
The Corporation also announces that Cougar’s working interest partner in the Lucy project was unable to complete the financing to the agreement previously announced on April 16, 2009. As default payment, Cougar has accepted the transfer of the Alexander and Crossfield producing properties. The properties have an estimated average production of 15 barrels of oil equivalent per day. Cougar will update the reserve report information as soon as possible.