Millennium Energy Corporation announces formation of joint venture with Westoil LLC, on two vast oil blocks in Sakhalin Region, Russian Federation
NEW YORK, Oct. 13, 2014 /PRNewswire/ -- Millennium Energy Corporation (OTC Pink: MENC) is pleased to announce the execution of an agreement for the formation of a joint venture with Westoil LLC, a Russian Corporation, on two Oil Exploration Blocks covering 465 sq Kilometers and 85 sq kilometers located in the Sakhalin Region, Russian Federation:
The Vazinski License block's surface area is equal to 465 square kilometers and is licensed by Ministry of Natural Resources Russian Federation, Sakhalin Region, Nogliksk District license number YUSKH - OII78 -NR granted on December 29, 2010 valid until January 1, 2036.
The territory of Vazinski licensed area is located at the Nogliki District of Sakhalin Island, Federal Republic of Russia; it is located 40 km to the south - south-west of the regional center of the district of Nogliki settlement. The site is located between two rivers called the Vazi River and the Nabil River. The topography relief of the area is mainly hilly and steeply sloping. The absolute levels range between 20 meters and 120 meters. It has been reported that the local government geological survey estimates of oil and gas for the license region are between 7.5 and 8.370 million tons of oil and gas equivalent. However the company will not adopt these estimates, the entire area will have to be 3 d seismic mapped and several wells will need to be drilled in order to accurately confirm the size of the oil and gas reserves in the license area and this process is anticipated to take two to three years to complete. There can be no assurance of the results of the test wells until the wells have been drilled and the data recording the actual geological reserves recorded.
The Verhoturovski License block's surface area is equal to 85 square kilometers and is licensed by Ministry of Natural Resources Russian Federation, Sakhalin Region, Nogliksk District, license number YUSKH - OII79 -NR granted on December 2, 2010 valid until January 1, 2036.
The territory of Verhoturovski licensed area is located in the Okha Administrative Region of Sakhalin Island, Federal Republic of Russia. The site is located on the coastal land of Piltun Bay in the Northern part. The relief is hilly with an altitude in the northern part up to 50 meters and in its western part between 25 and 60 meters, forest cover of the territory is estimated at 80%. It has been reported that the local government geological surveys have estimates of oil and gas for the Southern region of the license area are estimated at up to 13 million tons of oil and gas equivalent and up to 428 million tons of oil and gas equivalent in the Northern region of the license area. However the company will not adopt these estimates, the entire area will have to be 3 d seismic mapped and several wells will need to be drilled in order to accurately confirm the size of the oil and gas reserves in the license area and this process is anticipated to take two to three years to complete. There can be no assurance of the results of the test wells until the wells have been drilled and the data recording the actual geological reserves recorded.
There exists a well developed oil and gas infrastructure in close vicinity to the license areas and a well developed network of pipelines and gathering systems that are available to transport oil and gas in the region that has seen large foreign investment by consortiums of international oil companies led by Exxon & Neftegaz in Sakhalin 1 project and by a Shell led consortium in Sakhalin 2, together the energy companies have according to numerous media reports invested over $20 billion dollars in the Sakhalin Island Natural gas projects turning it into one of the largest Natural gas production regions in the world.
Russian oil production, currently at 10.55 million barrels per day is one of the world's largest, but Sanctions on export of USA oil technology could derail future foreign investment in Russia's oil industry. Russia is home to the largest combined oil and gas reserves in the world.
Commercial Terms:
In consideration of the contribution of the two exploration licenses to the Millennium Energy Corp/ Westoil LLC joint venture, the company will issue to Westoil LLC, 50 million common shares @ $3.00 per share and will issue an additional 50 million shares @$3.00 per shares in connection with the financing of the joint venture.
Millennium has proposed to arrange a debt financing to finance the works relating to the pre development including the completion of the 3 d seismic mapping of the prospective areas and the exploration and drilling of 5 oil wells in the two license areas in Sakhalin Region of the Russian Federation. The exploration budget will be mutually agreed and prepared by the management of Westoil LLC and the Company.
The Company and Westoil LLC are working on formal agreements to give effect to the transactions and anticipate completing these operating and financing agreements within the last quarter of 2014.
Irving Aronson, the Chairman of Millennium Energy Corp, said "We are very pleased to have secured this opportunity for the company and are excited by the immense potential of the Sakhalin region that is well known to host one of the largest hydrocarbon formations in the world, this transaction will undoubtedly greatly enhance the value of the company for the benefit of all shareholders."
Safe Harbor
This release contains statements that constitute forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended and Section 21E of the Securities Exchange Act of 1934, as amended. These statements appear in a number of places in this release and include all statements that are not statements of historical fact regarding the intent, belief or current expectations of Millennium Energy Corporation, its directors or its officers with respect to, among other things: (i) financing plans; (ii) trends affecting its financial condition or results of operations; (iii) growth strategy and operating strategy. The words "May," "would," "will," "expect," "estimate," "can," "believe," "potential" and similar expressions and variations thereof are intended to identify forward-looking statements. Investors are cautioned that any such forward-looking statements are not guarantees of future performance and involve risks and uncertainties, many of which are beyond Millennium Energy Corporation's ability to control, and that actual results may differ materially from those projected in the forward-looking statements as a result of various factors. More information about the potential factors that could affect the business and financial results is and will be included in Millennium Energy Corporation's filings with OTC Markets and/or the SEC.
Contact:
For further information please contact:
Millennium Energy Corporation
Public Relations and Shareholder Information
2nd Floor, New York
NY 10019
Or Tel Irving Aronson
Chief Executive Officer
London : 44 79783289
email [email protected]
SOURCE Millennium Energy Corporation
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