August 19, 2010
Blackbird Energy Inc. has entered into an agreement with the vendor of its Mathers-Gordon Prospect, amending the terms of the original purchase agreement.
Pursuant to the amended terms, Blackbird has increased its interest in the Prospect from 50% to 75%. In consideration for the foregoing, Blackbird has agreed to (1) a one-time payment of US$30,000, (2) pursue a three well farm out arrangement (with step out provisions) for further development of key formations in the Prospect, and (3) finish the recompletion of the two Mathers Prospect wells currently in process. In addition, the amended terms provide for an accelerated payback to Blackbird for all costs incurred to date and all subsequent re-completion costs.
As previously announced, Blackbird has re-entered two Mather's Prospect wells located in the Thorndike Field, Gray County, Texas. The Mathers 2-74 and 2A-74 wells were re-entered, perforated and fracture stimulated, and have been awaiting further re-completion efforts. The requirement for additional work on these wells provided an ideal opportunity to negotiate an increase to Blackbird's interest, for what the Corporation feels is a nominal amount given the added value.
Garth Braun, Blackbird CEO, stated, "We are extremely pleased with the new terms of our arrangement and the fact that we could increase our interest with such favorable conditions. Under these revised terms, we have further incentive to successfully re-complete the two wells. In regards to the farm-out condition that we have negotiated, we are very pleased at this opportunity to mitigate our risk and preserve capital. The Granite Wash is a very high profile field with substantial interest, and so we are confident on entering into a farm out on terms very favorable to Blackbird. We anticipate entering into a three well farm out package in the near future."
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