Chancellor bought these wells through its fully-owned subsidiary, Gryphon Production Company. The company paid a cash of $150000 for the purchase.
Maxwell Grant, chairman of Chancellor, said: “We are very pleased to announce this acquisition which we believe has excellent potential. As announced in our 8K we closed the deal on May 27, 2010 but waited until the change of ownership documentation was finalized with The Texas Railroad Commission, the oil and gas regulatory body in Texas, with whom we have a $250,000 bond and hold an oil and gas operator’s license.”
The company said that the integrity of the wells have also now been tested. All but two of the wells appear to be equipped with pump jacks and down-hole rods and tubing. There are 15 potential producing wells. The other well is a water disposal well. Whereas it may not be possible, on the law of averages, to bring the whole 15 of the shut-in wells back on, we believe 10 at least is not an over-optimistic figure.
The company added that some electrical work has to be done and has already been started. Some new flow lines will have to be laid but we are hopeful the restoration of this field will be very much a ‘pay-for-itself-as-it-goes’ proposition. They are the sort of propositions we like.
