REG - Nostra Terra O&G Co - NTOG enters a Strategic Partnership

Nostra Terra Oil and GasAnnouncement

16/01/2024 07:00

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RNS Number : 7694Z  Nostra Terra Oil & Gas Company PLC  16 January 2024

16 January 2024

 

Nostra Terra Oil and Gas Company Plc

("Nostra Terra" or "the Company")

 

NTOG enters a Strategic Partnership for Production Growth Opportunities in
East Texas.

 

Nostra Terra (AIM: NTOG), the international oil & gas exploration and
production company with a portfolio of development and production assets in
Texas, USA, is pleased to announce, further to its announcement on 11 January
2024, the signing of a Strategic Partnership with a subsidiary of Cypress. The
Partnership will allow the two companies to use an extensive, modern, regional
3D Seismic data set to jointly develop production growth opportunities across
an expansive area of East Texas where the Companies have already experienced
great results.

 

Highlights:

 

·    Partnership Area includes 80,000 acres (324 km(2)) of modern 3D
seismic

·    Area is more than 30x larger than Pine Mills and includes multiple
counties in East Texas

·    NTOG will operate any new locations and have an 87.5% working
interest

·    Initial focus will be the sub-Clarksville horizon, successfully
developed in the Fouke wells

·    All regional producing horizons are included in the agreement (in
addition to the initial target)

 

On 22 April 2020, Nostra Terra entered into a farmout agreement with Cypress
Minerals for an 80-acre portion (the "Well Area") of Nostra Terra's 2,400-acre
holding at Pine Mills. Cypress Minerals LLC and Cypress Production Inc
(together "Cypress") had acquired 3D seismic covering the Well Area and
identified several potential well locations. Following this, Cypress drilled
the two successful "Fouke" wells in the Pine Mills field.

 

These wells have produced over 130,000 barrels of oil (100% oil, no water) and
continue to produce at strong rates. The Fouke 1 well reached payback rapidly
while on a restricted allowable production rate, due to field rules in place
at the time of discovery. After a successful petition by the operator to
increase the field allowable rate, the Fouke 2 well reached payback less than
three months from production start-up.  These well results have provided
superior returns for the Company and have been the subject of detailed
technical study since their completion.

 

As a result of these efforts, Nostra Terra and Cypress have entered into a
broad strategic partnership whereby the companies will work together using
this 3D seismic data set to identify additional Fouke-like drilling locations.
This partnership is regional in scope and will cover the entire 80,000 acres
of existing 3D seismic data that Cypress has acquired. This represents an area
more than 30 times the size of Nostra Terra's 2,400-acre Pine Mills oilfield.
Additionally, any locations developed through this partnership will be
operated by Nostra Terra with a minimum of an 87.5% working interest.  This
is a significant increase to the 32.5% working interest the Company retained
in the original Fouke wells. The Company will be responsible for the cost and
operations while Cypress will be carried in the initial three wells along with
a small override.

 

The initial target of the exercise will be the sub-Clarksville horizon found
in the Fouke wells, but the technical focus will not be limited to this
horizon alone.  The entire Woodbine sequence and several others that have
been found productive within this vast 80,000-acre area have been included in
this partnership.

 

 

 

Matt Lofgran, Nostra Terra's Chief Executive Officer, said:

 

"I'm very pleased to announce signing this agreement with our partners at
Cypress.  The success of the Fouke wells in our mature Pine Mills asset has
been the focus of our technical efforts over the last several years.  This
work demonstrated that with the benefit of modern 3D seismic, the abundance of
existing well information and very detailed geologic mapping work, prospects
can be generated with the potential for Fouke-like results across an extensive
area.  Undrilled fault blocks, like Fouke, can now be identified, profitably
developed and put into production in short time frames, given their locations
in and around these mature assets. The area's future potential may exceed its
past performance based on the work done to date.  This is an exciting time
for the Company and I look forward to reporting on our results in subsequent
periods."

 

 

This announcement contains inside information for the purposes of Article 7 of
the Market Abuse Regulation (EU) No. 596/2014, as it forms part of UK Domestic
Law by virtue of the European Union (Withdrawal) Act 2018. Upon the
publication of this announcement, this inside information is now considered to
be in the public domain.

 

 

For further information, contact:

 Nostra Terra Oil and Gas Company plc  Tel:  +1 480 993 8933

 Matt Lofgran, CEO

 Beaumont Cornish Limited              Tel:  +44 (0) 20 7628 3396

 (Nominated Adviser)

 James Biddle/ Roland Cornish

 Novum Securities Limited (Broker)     Tel:  +44 (0) 207 399 9425

 Jon Belliss

 

 

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