The LOI is subject to completion of due diligence and the execution of a final Sale and Purchase Agreement. Under the agreement, Savoy will have an 80% net revenue interest in the field.
The field currently has no less than 34 existing well bores that the company believes are capable of production with seven of those wells currently in production.
Savoy said that current production is logged at 60/70bopd and is being produced from three of five known field formations. The reports from engineers and geologists employed by a previous operator show that the geology of the field was well defined through the drilling, logging and coring of wells in the area. An existing reserve report projects that 1.3 to 1.6 million bbls of oil may be recoverable from the field.
Arthur Bertagnolli, CEO of Savoy, said: “The acquisition of this interest is consistent with our strategy of identifying and acquiring underdeveloped oil and gas interests. We believe that the remaining wells that can be returned to production at a favorable well intervention cost have the potential of achieving a production goal of 100bopd from the field.”
