Royale Energy Announces $43,000,000 Alaska North Slope JV
SAN DIEGO, April 10, 2013 (GLOBE NEWSWIRE) -- Royale Energy, Inc. (Nasdaq:ROYL) today announced that it has signed a letter of intent to receive $100 per acre in cash, plus other consideration including stock options and exploration cost sharing for a total of over $1,200 per acre for up to 50,875 acres of its 96,000 acre Alaska North Slope holdings.
An undisclosed company has agreed in principal to fund all exploration costs for seismic data acquisition and the drilling of two horizontal wells for a total of $38 million. Additionally Royale will receive $3,373,659 USD for the 33,736.59 acres on the company's Western Block, together with stock options and a right to receive an additional $1.7 million USD for 17,000 acres in the company's Central Block.
"We are pleased to have found a company that shares our vision and optimism for the potential of these important Alaska shale oil resources," noted Stephen Hosmer, Royale Co-CEO. "This agreement will allow us to confirm participation in a planned 3D seismic data acquisition scheduled to take place later this year over our acreage."
The focus of the exploration that results from this agreement will take place in the western block Royale acquired in December. Each well location is expected to be selected with the full support of seismic data, to test both conventional and shale oil resource accumulations anticipated to be present.
The transaction is subject to consummation of a final agreement setting forth the detailed terms of investment and the exploration of the property. The prospective agreement is still under negotiation between the parties and is expected to be completed on or before May 30 this year.
Forward Looking Statements
In addition to historical information contained herein, this news release contains "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995, subject to various risks and uncertainties that could cause the company's actual results to differ materially from those in the "forward-looking" statements. While the company believes its forward looking statements are based upon reasonable assumptions, there are factors that are difficult to predict and that are influenced by economic and other conditions beyond the company's control. Investors are directed to consider such risks and other uncertainties discussed in documents filed by the company with the Securities and Exchange Commission.