Three of the nine Participants are non-arm’s length parties (“Non-Arm’s Length Participants”). Each Non-Arm’s Length Participant has paid Sundance a $20,000 equalization payment for expenses previously incurred on the Alexander Property, and is paying 5% of the costs to drill, complete and equip the 16A-11 Test Well to each earn a 3% working interest in the 16A-11 Test Well and the applicable drilling spacing unit. By participating in the 16A-11 Test Well each of the Non-Arm’s Length Participants will also earn the right to participate for a 2.5% working interest in future wells drilled on 5 of the 27 sections (3,200 acres) of land that comprise the Alexander Property (the “Farm-out Lands”).
Cumulatively, the Farm-Outs have provided Sundance with $120,000 in equalization payments from the Participants. The Participants are cumulatively paying 33% of the costs to drill, complete and equip the 16A-11 Test Well in order to cumulatively earn a 21% working interest in the well and the applicable drilling spacing unit. Sundance is paying 17% of the costs to drill, complete and equip the 16A-11 Test Well and will maintain a 29% working interest in the well and the applicable drilling spacing unit. By participating in the 16A-11 Test Well the Participants will also cumulatively earn the right to participate for a 17.5% working interest in future wells drilled on the Farm-Out Lands. Sundance will maintain a 32.5% working interest in the Farm-out Lands and a 50% working interest in the other 22 sections (14,080 acres) of land that comprise the Alexander Property. If at any time in the future a Participant declines on its right to participate in its working interest on a well proposed to be drilled on the Farm-out Lands, the Participant will lose all rights to participate in future wells to be drilled on the Farm-out Lands.
Sundance is the operator of the 16A-11 Test Well and the Alexander Property. The 16A-11 Test Well has been identified utilizing extensive 3D seismic data and modeling. The 16A-11 Test Well is primarily targeting light oil production from the Detrital Sand formation and secondly light oil production from the shallower Alexander Sand formation.
Sundance Energy Corporation is a junior publicly traded oil and gas company whose primary focus is exploring First Nation Lands in Western Canada. Sundance trades in Canada on the TSX Venture Exchange under the trading symbol “SNY”.
Forward Looking Statements & Additional Cautionary Language
This news release contains forward-looking statements relating to the future operations of the Corporation and other statements that are not historical facts. Forward-looking statements are often identified by terms such as “will”, “may”, “should”, “anticipate”, “expects” and similar expressions. All statements other than statements of historical fact, included in this release, including, without limitation, statements regarding future plans and objectives of the Corporation, are forward looking statements that involve risks and uncertainties. There can be no assurance that such statements will prove to be accurate and actual results and future events could differ materially from those anticipated in such statements. Important factors that could cause actual results to differ materially from the Corporation’s expectations are exploration risks detailed from time to time in the filings made by the Corporation with securities regulations.
The reader is cautioned that assumptions used in the preparation of any forward-looking information may prove to be incorrect. Events or circumstances may cause actual results to differ materially from those predicted, as a result of numerous known and unknown risks, uncertainties, and other factors, many of which are beyond the control of Sundance. As a result, we cannot guarantee that any forward-looking statement will materialize and the reader is cautioned not to place undue reliance on any forward-looking information. Such information, although considered reasonable by management at the time of preparation, may prove to be incorrect and actual results may differ materially from those anticipated. Forward-looking statements contained in this news release are expressly qualified by this cautionary statement. The forward-looking statements contained in this news release are made as of the date of this news release, and Sundance does not undertake any obligation to update publicly or to revise any of the included forward-looking statements, whether as a result of new information, future events or otherwise, except as expressly required by Canadian securities law.
Neither the TSX Venture Exchange nor its Regulation Service Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release. No stock exchange, securities commission or other regulatory authority has approved nor disapproved the information contained herein.
Sundance Energy Corporation
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