17 March 2008
For Immediate Release 17 March 2008
Barnwell Brawley Lease Farmout and Well Deepening
TXO PLC ('TXO' or the 'Company') is pleased to announce that it has entered into
a Farmout Agreement with Managed Petroleum Group, Inc. of Richardson, Texas
The Farmout covers the Barnwell Brawley lease, comprising four wells, in which
the Company has a 100% working interest and an 80% net revenue interest.
Under the terms of the Farmout, MPG agrees to deepen four wells to a depth
sufficient to test the lower stringer of the Woodbine Formation (approximately
The deepening, which will be paid for by MPG, is estimated to cost $400,000. The
work will be managed by TOGS Energy Inc., TXO's 100% subsidiary.
When the four wells have been drilled, tested and completed as a commercial
producer of oil and or gas, MPG will earn a 75% gross working interest (60% net
revenue interest) and the Company will retain a 25% perpetual carried working
interest (20% net revenue interest) in the lease.
The Company regards this Farmout as a very exciting development, as there have
been a number of recent successful deepenings carried out on neighbouring
leases. The Barnwell Brawley lease currently produces only some 2.5 barrels per
day, and the purpose of the well deepening is to significantly increase the
production from this lease.
MPG is not related in any way to TXO or MC Production and Drilling Inc or their
subsidiaries or any of the directors.
TXO currently owns interests in 348 wells on 86 leases in the East Texas Field
through its US subsidiary TOGS Energy Inc, and these include several leases
within the deepening area of the East Texas Field.
Andrew Glendinning, TXO plc on 020 7863 8852
Roland Cornish, Beaumont Cornish Limited on 020 7628 3396
This information is provided by RNS
The company news service from the London Stock Exchange