Fri, 27th Apr 2018 07:00
27 April, 2018
Highlands Natural Resources plc ('Highlands' or 'the Company')
Phase 2 drilling at its East Denver Project
Highlands, the London-listed natural resources company, is pleased to announce that drilling operations at the East Denver Niobrara shale oil and gas project ("East Denver" or "the Project") have recommenced with a third well being spud today.
This follows Highlands' agreement with True Oil LLC, announced on 20 April 2018, which sees the entire capital costs of at least six additional wells funded by Highlands' partners. Highlands has received in return an immediate cash payment of US$5.4 million and a 7.5% carried interest in all current and future East Denver wells. It is expected that the next six wells will be drilled on the northern drilling and spacing unit ("DSU") over the next eight weeks. On completion, the total number of wells at East Denver will be eight.
Highlands remains operator of the project currently, although True has the option to assume operatorship of the East Denver project in the future.
Robert Price, Highlands' Chairman and CEO, said: "Less than a week after securing our financing deal with True, we are spudding our first new well. This rapid development means that we are set to bring significant additional cash flows to our company.
"This will create a strong backbone for our company as we focus on replicating the success we have experienced so far in proving up the significant productivity of our acreage before partnering with major companies to fund an extensive and costly programme. This proven model provides us with a carried interest without diluting shareholders."
For further information:
Highlands Natural Resources plc
Robert Price +1 (0) 303 322 1066
Cantor Fitzgerald Europe
Nick Tulloch +44 (0) 20 7894 7000
Fiona Norman +44 (0) 20 3757 6880
Notes to Editors
Highlands (LSE: HNR.L) is a London-listed natural resources company with a portfolio of high-potential oil, gas and helium assets and technologies. The Company's core projects include:
· East Denver Niobrara: a horizontal oil and gas project targeting the Niobrara shale formation in a well-studied area of the Denver Julesburg Basin. The Company has two wells drilled and producing cash flow and is now fully funded for at least six additional wells, to be delivered in the short term. It has a 7.5% carried interest in existing and future wells.
· DT Ultravert: a re-fracking and parent well protection technology with four patents allowed and additional patents pending in the United States and internationally. Highlands is advancing commercial conversations with a range of oil and gas operators and service providers to commercialize DT Ultravert technology.
· Helios Two: a 220,000+ acre helium and natural gas prospect in SE Montana with drilling and assessment operations ongoing.