LONDON, November 21 /CNW/ - Fox Petroleum Inc. (OTCBB:FXPE) (hereafter
"Fox Petroleum") is pleased to announce the signing of a Farm- in Agreement to
acquire a 46% working interest on Block 211/17 South in a joint venture with
Petrofac Energy Developments Limited (LSE:PFC) and Valiant Petroleum Limited,
a well funded privately held company. After farm-in, which is dependant on Fox
drilling an exploration well on the block during 2008, the partnership
ownership percentages will be; Fox Energy Exploration Ltd 46%, Petrofac 24%
and Valiant 30%.
Under a separate agreement, Fox will transfer a 4.6% carried interest
(10% of its acquired interest) to Aimwell Energy Ltd, in recognition of
Aimwell's experience and technical support in defining and developing the
prospect. The beneficial owners of Aimwell are members of the Fox Petroleum
Advisory Board, but will receive no cash or stock payment, other than the
The FIA covers the southern half of block 211/17 in the UK North Sea and
comprises of 3 prospects that are believed to have a combined total potential
reserve (mid case) of over 0.5 billion barrels of recoverable oil. The joint
venture project provides a significant opportunity for Fox Petroleum to work
amongst experienced North Sea Exploration companies, and adds roughly 24,500
acres to build upon their existing 37,000 acres in the Central North Sea.
Fox's primary target for an exploration well will be the Bourbon Prospect.
About the Bourbon Prospect.
The Bourbon is estimated to have a total potential reserve (mid case) of
167 million barrels of recoverable oil (mmbo). The prospect is located in a
geological structure of the North Sea known as the Brent Sandstone in the
southern part of block 211/17. The Brent Sandstone consists of tilted fault
blocks that are favourable for trapping hydrocarbon deposits, and is believed
to be one of the lowest risk exploration styles in the North Sea. The prospect
is considered to be of low risk due to this geological formation and also as a
result of the shows and potential oil-water contact in the SW of the block,
where the 211/17-3 well was previously drilled and is interpreted to have
already tested the oil-water transition zone of an accumulation.
Secondary prospectivity is located in the Statfjord and Cormorant
sandstones, which are located directly below the Brent Sandstone. Estimates
for these addition projects are a total possible reserve of 30 million barrels
(mid case). Further exploration possibilities are recognized in Upper Jurassic
sandstones, which represent an additional total potential (mid case) of 278
and 45 million barrels of recoverable oil respectively in 2 separate targets,
both within the 211/17 block.
In return for the 46% working interest Fox Petroleum agrees to pay for
89% of an exploration well drilled to a depth of approximately 10,300ft. Fox
and Aimwell consider the Brent Sandstone Bourbon prospect to be one of the
lowest risk prospects remaining in the North Sea.
Production in the Area
Royal Dutch Shell is the most active producer in close proximity to the
Bourbon Prospect, as they own and operate many producing fields in the area,
including; The Eider Field (211/16a & 211/21a); The Magnus Field (211/12a),
which has a potential reserve of 1.65 billion barrels; The Cormorant
Production Facility (211/26a), which is the starting point of the Brent pipe
system; and the Tern Production Facilities (210/25a). Other companies
producing in the area include: BP, Lundin Petroleum AB, Nexen Inc, and Conoco
Vice President, Finance of Fox Petroleum, Alex Craven, states
that "This acquisition strengthens our North Sea position considerably
and represents another significant step in our strategy of acquiring low risk,
high potential assets and ultimately our goal to achieve significant
production and cash flow."
The project provides the possibility for Fox Petroleum to participate in
a number of additional prospects within the area, and represents a significant
opportunity for Fox to increase its operations in the North Sea.
Two major production facilities exist in adjacent blocks, including;
Eider to the west and Magnus to the North. The existing pipeline and
production infrastructure links could be utilized by Fox Petroleum in the
event of a discovery. The Eider field has a very similar geological structure
as the Bourbon prospect, and is currently producing 1900 barrels of oil per
day. The existing pipeline has a total capacity of 50,000 barrels of oil per
day representing a vast excess in capacity for production.
Richard Moore, Chief Executive Officer of Fox Petroleum explains that "We
are very excited to be part of what we consider to be as good as any prospect
in the North Sea, and the size of the project will help promote Fox as one the
larger players in the region."
Shareholders and prospective investors are encouraged to visit Fox
Petroleum's website: www.foxpetro.com and download Fox Petroleum's Investor
Summary. Please feel free to call investor relations toll-free at
1-888-369-4744 to receive a full corporate investor's package.
About Fox Petroleum
Fox Petroleum Inc. is an Oil and Gas Exploration Company headquartered in
London, England, the financial capital of Europe. Fox also has an operations
office in Anchorage, Alaska. Fox's current targets include mineral rights to
32,000+ acres in Alaska's North Slope estimated to represent a potential of up
to 160 million barrels of oil (LAPP Resources, Inc.), and the rights to a
33.33% ownership stake in a 37,000+ acre UK North Sea license which could
potentially hold up to 213 million barrels of oil (TRACS International Ltd).
Fox has a 22.5% interest in JV of an onshore Texan gas well, and has also
signed agreements to acquire roughly 5,000 acres on the North Slope and
approximately 42,000 of land onshore in the Cook Inlet containing the
Catcher's Mitt Prospect. The Company's shares are publicly traded on the NASD
OTC BB under the ticker symbol FXPE.
On behalf of the Board of Directors
FOX PETROLEUM INC.
Alex Craven, Vice President, Finance
Legal Notice Regarding Forward-Looking Statements
Legal Notice Regarding Forward-Looking Statements in this news release
that are not historical facts are forward-looking statements that are subject
to risks and uncertainties. Forward-looking statements are based on current
facts and analyses and other information that are based on forecasts of future
results, estimates of amounts not yet determined and assumptions of
management. Forward looking statements are generally, but not always,
identified by the words "expects", "plans", "anticipates", "believes",
"intends", "estimates", "projects", "aims", "potential", "goal", "objective",
"prospective", and similar expressions or that events or conditions "will",
"would", "may", "can", "could" or "should" occur. Information concerning oil
or natural gas reserve estimates may also be deemed to be forward looking
statements, as it constitutes a prediction of what might be found to be
present when and if a project is actually developed.
Forward-looking statements in this news release include that our mineral
rights in Alaska's North Slope is estimated to contain a potential of up to
160 million barrels of oil; that UK North Sea license which we own a 33.33%
ownership could potentially hold up to 213 million barrels of oil; that the
Spears Gas Well is estimated to be spudded within this quarter of 2007 or
could become Fox Petroleum's first production well; that acquisition of the
22.5% joint venture interest in the Spears Gas Well could result in short term
revenue, production or bookable reserves; that the revenue potential of the
Spears Gas Well could cover the investment in a matter months; that Spears Gas
Well could potentially produce up to 3,000 MCFGPD or greater; we could
potentially drill a well on the Catcher's Mitt prospect in 2008; there will be
sufficient capacity in the pipeline from Catcher's Mitt if gas is produced; we
will be granted rights to explore the all acreage from the relative governing
bodies; the 211/17 south block is estimated to have a potential of over 0.5
billion barrels of oil; the Bourbon prospect has potential of 167 mmbo; the
Liassic/Triassic Statfjord, and the Triassic Cormorant sandstone total
possible reserve of 30 mmbo; the Upper Jurassic Magnus, and the Ptarmigan
sandstones, represent an additional total potential of 278 and 45 mmbo; Fox
may be able to tie into existing infrastructure; an exploration well is
planned on 211/17 South for 2008.
Actual results may differ materially from those currently anticipated due
to a number of factors beyond the reasonable control of the Company. It is
important to note that actual outcomes and the Company's actual results could
differ materially from those in such forward-looking statements. Factors that
could cause actual results to differ materially include misinterpretation of
data, inaccurate estimates of oil and natural gas reserves, the uncertainty of
the requirements demanded by environmental agencies, the Company's ability to
raise financing for operations, breach by parties with whom we have
contracted, inability to maintain qualified employees or consultants because
of compensation or other issues, competition for equipment, inability to
obtain drilling permits, potential delays or obstacles in drilling operations
and interpreting data, the likelihood that no commercial quantities of oil or
gas are found or recoverable, successful closing of the acquisition of joint
venture partnership interest in the Spears Gas Well, the 211/17 South JV, the
Cook Inlet and North Slope lease acquisitions, and our ability to participate
in the exploration of, and successful completion of development programs on
all aforementioned prospects and leases. Additional information on risks for
the Company can be found in filings on Edgar of other junior oil and gas
exploration companies with the US Securities and Exchange Commission.
For further information:
For further information: Fox Petroleum Inc. Investor Relations Alex
Craven, Vice President, Finance 1-888-FOX-4744 (1-888-369-4744)