Treaty Energy Corporation Signs Letter of Intent with U.S. Fuels, Inc. on West Texas Exploration Agreement Treaty Energy has Entered into a Binding Letter of Intent to Explore and Drill Five Leases that Cover 1,830 Acres
NEW ORLEANS, May 9, 2013 /PRNewswire/ -- Treaty Energy Corporation (OTC: TECO) (www.treatyenergy.com), a growth-oriented international energy company, today announced a binding Letter of Intent (LOI) with U.S. Fuels, Inc. of Breckenridge, Texas.
The eventual transaction to result from this LOI is an "Exploration Agreement" which is to be finalized before July 31, 2013, relating to five (5) West Texas leases covering approximately 1,830 acres. To view details on the binding Letter of Intent, please visit the following link: http://www.treatyenergy.com/sites/default/files/TECO_US_FUELS_LOI.pdf.
Treaty Energy is currently drilling two wells on the 40 acre Mitchell Lease in Taylor County, Texas which is included in this agreement. The other four Texas leases are as follows:
- Knott Lease – 40 Acres in Taylor County
- Stroebel Lease – 700 Acres in Eastland County
- Standard Lease – 400 Acres in Taylor County
- Bridges Lease – 650 Acres in Stephens County
Andrew V. Reid, Chairman and CEO of Treaty Energy Corporation, stated, "Treaty will pursue drilling and rework opportunities that offer greater initial production and better ROI in the future, rather than reworking and operating stripper wells. Going forward, Treaty intends to concentrate on prime leases with future wells, similar to the two Mitchell wells that are currently being drilled and completed."
Mr. Reid further stated, "Treaty has funding in place to drill a number of additional wells without needing to seek additional funding for new drilling projects. Management is confident that as production comes online from these initial new wells, drilling of additional wells will occur at a reasonable pace and will likely be funded through expected positive cash flows."
Since mid-Q1 2013, Treaty Energy has evaluated their existing lease inventory and has initiated plans to sell selected non-productive or underperforming leases to individuals or companies that are focused on small stripper wells and who are dedicated to servicing this type of lease.
With the execution of this agreement, Treaty Energy will have the capability to drill dozens of new wells in West Texas on these new leases. The new wells will be state-of-the-art in nature and hold much more promise and longevity for Treaty Energy and its shareholders. Implementing this new strategy will help Treaty to achieve the goals set by management.
Mr. Reid concluded with, "Treaty no longer intends to operate its own wells. Management's plan is to use proven operators with years of experience to oversee and operate Treaty's well inventory. This change in operating strategy will allow Treaty to concentrate on finding additional opportunities to drill and grow oil production, priorities which management believes will translate into rapid growth in assets, production, cash flow and the trading value of Treaty shares."
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 allows Treaty to develop and produce oil and natural gas with tremendously decreased risk, cost and time compared to traditional exploration.
Treaty Energy Corporation (TECO) trades on the OTC, the marketplace for companies that are current in their SEC reporting requirements. Investors can find real-time quotes and market information for Treaty Energy at http://www.otcmarkets.com/stock/TECO/quote.
Statements herein express management's beliefs and expectations regarding future performance and are forward-looking and involve risks and uncertainties, including, but not limited to, raising working capital and securing other financing; responding to competition and rapidly changing technology; and other risks. These risks are detailed in the Company's filings with the Securities and Exchange Commission, including Forms 10-KSB, 10-QSB and 8-K. Actual results may differ materially from such forward-looking statements.
Treaty Energy Corporation
SOURCE Treaty Energy Corporation