MINNEAPOLIS, March 8, 2011 /PRNewswire/ -- Avalon Oil & Gas, Inc., (Avalon) (OTC Bulletin Board :AOGN ; Frankfurt: A3MA) provided an update on operations in the East Chandler Field, Lincoln County, Oklahoma, and the acquisition of the Fossiltek, Inc., assets.
"We are pleased to report that the Grace #2 and the Grace #5A wells have been put back into production. Avalon began selling gas from the Grace #2 in August 2010, and oil and gas from the Grace #5A in January," said Avalon's CEO, Kent Rodriguez. "We are excited to have these wells producing again. With the increase in oil and natural prices and our low lifting costs, the production from the Grace Wells will have a measurable effect on Avalon's revenue stream going forward," he added. Avalon owns a 76.75% working interest and a 52.67% net revenue interest in the Grace #2; and a 75.00% working interest and 51.45% net revenue interest in the Grace #5A. The wells are producing two hundred mcf of gas and one barrel of oil per day. Avalon is continuing to acquire additional fractional working interests in each well, and is reviewing a plan to re-establish commercial production on the Grace #6.
Avalon has completed the due diligence on the Fossiltek, Inc. assets. "We are currently negotiating a Purchase Agreement and Sale Agreement and a Joint Operating Agreement to purchase non-operating working interests in five (5) producing oil wells and thirty-three (33) producing gas wells, for a combination of cash and newly issued common stock," said Avalon's CEO, Kent Rodriguez. The properties are located in the Anadarko Basin of Western Oklahoma, in the counties of Roger Mills, Grady, Caddo, Custer, Blaine, and Beckman and are currently producing six barrels of oil and three hundred thousand mcf of gas per day. "We hope to close this acquisition in the next thirty (30) days," added Rodriguez
About Avalon Oil & Gas, Inc.
Avalon Oil & Gas is an oil and gas company engaged in the acquisition and development of producing oil and gas properties. In addition, Avalon's technology group acquires and develops energy production enhancing technologies. Through Oiltek, Inc., Avalon's majority-owned subsidiary, Avalon is building an asset portfolio of innovative technologies in the oil and gas industry to maximize enhancement opportunities.
This press release contains statements, which may constitute "forward-looking statements" within the meaning of the Securities Act of 1933 and the Securities Exchange Act of 1934, as amended by the Private Securities Litigation Reform Act of 1995. Those statements include statements regarding the intent, belief or current expectations of Avalon Oil & Gas, Inc., and members of its management as well as the assumptions on which such statements are based. Prospective investors are cautioned that any such forward-looking statements are not guarantees of future performance and involve risks and uncertainties, and that actual results may differ materially from those contemplated by such forward-looking statements. The Company undertakes no obligation to update or revise forward-looking statements to reflect changed assumptions, the occurrence of unanticipated events or changes to future operating results.
FOR FURTHER INFORMATION, please visit the company's website at www.avalonoil.com.
SOURCE Avalon Oil & Gas, Inc.