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8-K - HOUSTON AMERICAN ENERGY CORP 8-K 10-14-2009 - HOUSTON AMERICAN ENERGY CORP | form8k.htm |
Exhibit 99.1
Houston
American Energy Corp
801
Travis, Suite 1425, Houston, Texas 77002
(713)
222-6966 Fax. (713) 222-6440
Houston
American Energy Corp Announces Completion of New Farmout in
Colombia
Houston,
Texas – October 16, 2009 - Houston American Energy Corp (Nasdaq: HUSA) today
announced that it has finalized a Farmout Agreement and Joint Operating
Agreement with SK Energy Co. LTD. (“SK”) for the right to earn an undivided
twenty five percent (25.0%) of the rights to the CPO 4 Contract for Exploration
and Production (the “CPO 4 Contract”) which covers the CPO 4 Block located in
the Western Llanos Basin in the Republic of Colombia. The CPO 4
Contract was entered into between the National Hydrocarbon Agency (“ANH”) in
Colombia and SK on December 18, 2008. SK is a leading Korean
multinational conglomerate with oil production, development and exploration
projects as well as integrated gas development projects around the
world.
The CPO 4
Block consists of 345,452 net acres and contains over 100 identified leads or
prospects which will be detailed during the first exploration phase of the
concession contract with the ANH. The Block is located along the
highly productive western margin of the Llanos Basin and is adjacent to Apiay
field operated by Ecopetrol, which is estimated to have in excess of 610 million
barrels of 25-33 API oil in place. On the CPO 4 Block’s other side
lays the Corcel Block where well rates of 2,000 to 10,000 barrels of production
per day have been announced for recent discoveries. In addition, the
CPO 4 Block is located nearby oil and gas pipeline
infrastructure. Potentially productive reservoirs include the
Mirador, Une, C-7, C-9 and Guadalupe formations.
Under the
Farmout Agreement, Houston American has agreed to pay 25.0% of all past and
future cost related to the CPO 4 block as well as an additional 12.5% of the
Seismic Acquisition Costs incurred during the Phase 1 Work Program, for which
Houston American will receive a 25.0% interest in the CPO 4 Block.
The Phase
1 Work Program consists of reprocessing approximately 400 kilometers of existing
2-D seismic data, the acquisition, processing and interpretation of a 2-D
seismic program containing approximately 620 kilometers of data and the drilling
of two exploration wells. The Phase 1 Work Program is estimated to be
completed by June 17, 2012. Houston American’s costs for the entire
Phase 1 Work Program are estimated to total approximately $15,000,000 over the
next three years.
“We are
excited that we are able to participate with SK in the CPO 4 Block and believe
that the Contract area provides a significant growth opportunity for Houston
American. The CPO 4 block is located in a highly prospective area
having multiple play objectives with extremely large reserve
potential. Partnering with SK creates a solid partnership bringing
geotechnical, operational, commercial, and marketing strengths to the
table. This new asset, in addition to our current portfolio,
strengthens our upside drilling opportunity base in our main focus area for
years to come.” said John F. Terwilliger, CEO, Houston American Energy
Corp.
About
Houston American Energy Corp
Based in
Houston, Texas, Houston American Energy Corp is an independent energy company
with interests in oil and natural gas wells and prospects. The company's
business strategy includes a property mix of producing and non-producing assets
with a focus on Texas, Louisiana and Colombia.
Forward-Looking
Statements
The
information in this release includes certain forward-looking statements that are
based on assumptions that in the future may prove not to have been accurate,
including estimated costs of, and time to complete, the Phase 1 Work Program and
potential production, revenues, reserves, growth or profitability Houston
American may realize from the CPO 4 Contract. Those statements, and Houston
American Energy Corp, are subject to a number of risks, including production
variances from expectations, volatility of product prices, the capital
expenditures required to fund its operations, environmental risks, competition,
government regulation, and the ability of the company to implement its business
strategy. These and other risks are described in the company's documents and
reports filed from time to time with the Securities and Exchange Commission,
which reports are available from the company and the United States Securities
and Exchange Commission.
For
additional information, view the company's website at
www.houstonamericanenergy.com or contact the Houston American Energy Corp at
(713) 222-6966.