The property consists of approximately 15,000 acres with the majority being surface mineable, and the company will immediately begin an exploration program to produce a reserve estimate compliant with to NI43-101 standards.
The property is privately owned and the total purchase price currently under negotiation is $5m with an overriding royalty, of which $3.5m is subject to Xinergy receiving the required West Virginia Article 3 Permit.
Total consideration for the company includes all mineral, surface and mining rights for the property, technical information, and associated permits in place.
The company has provided a non-refundable deposit for a 90-day option to complete exploration and final due diligence, and closing of this acquisition is expected in early 2011.
