HOUSTON, May 14 /CNW/ - Enhanced Oil Resources, Inc. (TSX-V: EOR) today
provides the following update on corporate and operational activity.
At the St. Johns Helium and CO2 field the Company is preparing
development plans for the drilling of 5 wells under the Arizona Unit Agreement
agreed work program. The Unit agreement calls for the drilling of 5 wells
within 12 months after receiving final approval of the Unit. The State of
Arizona approved the Unit agreement on April 8th 2009, however the approval of
the Unit Agreement is subject to the final sanction by the federal government
and review and approval by the State Land Commissioner of any substantive
changes recommended by the federal government.
As previously reported the Company has engaged Tristone Capital to
explore potential joint venture opportunities for the Company's interests in
the St. Johns Helium and CO2 Field in Arizona and New Mexico. Following data
collection the Tristone managed data room was opened on April 14th 2009.
Several interested parties have visited the physical and virtual data rooms
and reviewed the data. The data room is expected to remain open until May
22nd. While the Company cannot guarantee a formal agreement of any type, we
remain encouraged by the interest shown so far. Further updates on the joint
venture process will be provided in the near future.
The Company continues to produce approximately 200 barrels of oil per day
(bopd) from its oilfields in New Mexico and the Milnesand pilot project
continues with CO(2) injection and is performing as expected. The net revenue
from our crude oil sales currently covers approximately 25% of our monthly
At our oilfields in New Mexico we continue to reduce operating costs
where possible and continue to focus on low cost production enhancement
operations and the Milnesand CO(2) pilot flood area. The process has begun at
our Chaveroo field to expand the Jennifer Unit, increasing the size from 5,500
acres to approximately 12,000 acres. The expanded unit will greatly assist the
process of implementing a CO(2) flood at Chaveroo in the future. The
production cycling program at Chaveroo continues and has further cut our crude
oil lifting cost from $27.11 per barrel oil equivalent ("boe") averaged for
the fourth quarter of 2008 to approximately $19.00 per boe without affecting
overall production rates. We anticipate further decreases in operating
expenses as efficiencies improve and service costs continue to decrease. At
Milnesand, the CO(2) pilot flood area has been under continuous CO(2)
injection for eight months and the positive upward trend in production
announced last month is continuing. While it is early in the process we remain
very encouraged with the results to date. During the third quarter we expect
to produce a mid-year engineering report that will evaluate the proved
reserves, if any, that can be categorized from the underlying contingent
resources in our San Andres oilfields.
The Company also announces the grant of 1,200,000 incentive stock options
for the purchase, for a period of five years, of 1,200,000 shares of the
company at a price of $0.44 per share pursuant to the terms of the Company's
Stock Option Plan approved by shareholders on September 4, 2008. Exercise of
the of options is contingent on achieving certain milestones as part of the
overall development of the Company's business plan.
About Enhanced Oil Resources Inc.
Enhanced Oil Resources Inc. is an early-stage company, with two principal
business segments of
(i) Crude oil and natural gas production through enhanced oil recovery
("EOR") projects it is initiating in the Permian Basin on oil
fields acquired by the Company in 2007 and 2008 for that purpose.
(ii) Helium and CO(2) resource exploration and production through
property interests it controls in approximately 251,000 gross
acres of land within the St Johns Helium/CO(2) field in Arizona
and New Mexico, and where the Company is developing what is
thought to be the largest undeveloped helium and carbon dioxide
field in North America.
Certain statements contained herein are forward-looking statements,
including statements relating to Enhanced Oil Resources' operations; business
prospects, expansion plans and strategies. Forward-looking information
typically contains statements with words such as "intends," "anticipate,"
"estimate," "expect," "potential," "could," "plan" or similar words suggesting
future outcomes. Readers are cautioned not to place undue reliance on
forward-looking information because it is possible that expectations,
predictions, forecasts, projections and other forms of forward-looking
information will not be achieved by Enhanced Oil Resources. By its nature,
forward-looking information involves numerous assumptions, inherent risks and
uncertainties. A change in any one of these factors could cause actual events
or results to differ materially from those projected in the forward-looking
information. Although Enhanced Oil Resources believes that the expectations
reflected in such forward-looking statements are reasonable, Enhanced Oil
Resources can give no assurance that such expectations will prove to be
correct. Forward-looking statements are based on current expectations,
estimates and projections that involve a number of risks and uncertainties
which could cause actual results to differ materially from those anticipated
by Enhanced Oil Resources and described in the forward-looking statements or
information. The forward-looking statements are based on a number of
assumptions which may prove to be incorrect. Readers should be aware that the
list of factors, risks and uncertainties set forth above are not exhaustive.
Readers should refer to Enhanced Oil Resources' current filings, which are
available at www.sedar.com, for a detailed discussion of these factors, risks
and uncertainties. The forward-looking statements or information contained in
this news release are made as of the date hereof and Enhanced Oil Resources
undertakes no obligation to update publicly or revise any forward-looking
statements or information, whether as a result of new information, future
events or otherwise, unless so required by applicable laws or regulatory
ON BEHALF OF THE BOARD OF DIRECTORS
Barry D Lasker, CEO
Neither TSX Venture Exchange nor its Regulation Services Provider (as
that term is defined in the policies of the TSX Venture Exchange) accepts
responsibility for the adequacy or accuracy of this release.
For further information:
For further information: visit our Website at www.enhancedoilres.com. or
please call Don Currie on 1-888-990-3551