The company relayed the recent changes made to its existing agreements for Eagle Ford assets in South Texas.
Oracle Energy Corp.’s (OEC:TSX.V; OECCF:OTC) wholly owned subsidiary Oracle Oil and Gas extended the dates of two existing agreements, one for its acquisition of Eagle Ford assets, the other for its purchase of mineral rights on adjoining acreage.
Regarding acquisition of the Eagle Ford assets, called the HBP assets, Oracle and a private owner agreed in an amendment to push back the closing date by six months, to March 29, 2019, from Sept. 28, 2018. They also agreed to delay the effective date to Jan. 1, 2019, from July 1, 2018. Pursuant to the amendment reflecting those changes, Oracle must deposit another $250,000 in cash before Oct. 31, 2018, which is to be applied toward the purchase price.
Earlier in the year, Oracle agreed to acquire a 100% working interest and a 74% net revenue interest in those HPB assets, which encompass 2,490 acres of oil and gas leases, six wells currently producing 80 barrels of oil equivalent per day, seven shut-in wells and the existing production infrastructure on the properties.
In other news, Oracle initiated an amendment to the May 2019 option agreement in which it agreed to acquire the mineral rights on 5,000 net acres adjoining the HBP assets. The recently signed amendment called for extending the period for the option to be exercised to Jan. 15, 2019.
That is contingent upon on three conditions. Oracle must make a $250,000 nonrefundable extension payment on or before Oct. 1, 2018, which the company says it has done; it must make a second $250,000 payment before Oct. 31, 2018, which the company says it will dp; and it must agree to an increase in lease payments per acre upon exercising the option.
Chairman and CEO Darrell L McKenna commented, “We continue to advance our plans on what we consider to be the best basin to operate, the Lower Eagle Ford oil window. The negotiations and the resultant amendments granted is a true testament in the deep-rooted relationships that we have built over the years from working in Texas. The team and I continue to work hard to bring this phenomenal project to its full potential and remain committed to spudding the first well in the first quarter of 2019.”