NEW ORLEANS, May 16, 2013 /PRNewswire/ -- Treaty Energy Corporation (OTCQB: TECO) ( www.treatyenergy.com), a growth-oriented international energy company, announced today the next step in the Company's hydrocarbon exploration program in West Texas.
On May 9, 2013, Treaty Energy Corporation announced a Binding Letter of Intent (LOI) for oil exploration with U.S. Fuels, Inc. of Breckenridge, Texas. The agreement covered approximately 1,830 acres and included five Texas leases as follows:
- Bridges Lease – 650 Acres in Stephens County
- Knott Lease – 40 Acres in Taylor County
- Mitchell Lease – 40 Acres in Taylor County
- Standard Lease – 400 Acres in Taylor County
- Stroebel Lease – 700 Acres in Eastland County
Included in this announcement was the drilling of two wells (Mitchell #3 and Mitchell #4) on the Mitchell Lease. The Mitchell Lease had been assigned to Treaty Energy based on the Company's commitment to drill and produce these two wells.
Today, Treaty Energy is pleased to announce that it has received an assignment of a 40 acre tract surrounding the #2 well on the Standard Lease and has made plans to immediately re-enter the Standard #2 well. The Standard #2 well is located approximately 350 feet away from the recently drilled Mitchell #4 well.Based on new well log information gathered from the Mitchell wells, Treaty Energy plans to perforate and acidize the Standard #2 in a zone not previously utilized. The rework cost on the Standard #2 has already been paid in advanced to the contractor that will be performing the re-entry operations. Andrew Reid, CEO and Chairman of Treaty Energy, stated, "Depending on the outcome of the initial re-work on the Standard Lease, the decision will be made as to whether to re-enter a second well. Management believes that the re-work on the Standard #2 well will provide Treaty with a low cost, high ROI, which will result in a profitable well based upon the recently acquired Mitchell geological data. The cost of re-completion will be about 20% of the cost of a new well, and thus making this operation, if successful, very valuable to Treaty Energy and its shareholders." About Treaty Energy Corporation Treaty is an international energy company engaged in the acquisition, development and production of oil and natural gas. Treaty acquires and develops oil and gas leases which have "proven but undeveloped reserves" at the time of acquisition. These properties are not strategic to large exploration-oriented oil and gas companies, which allow Treaty to develop and produce oil and natural gas with tremendously decreased risk, cost and time compared to traditional exploration.