Oil and natural gas exploration and production company Treaty Energy has executed a letter of intent to acquire the Vago-1 project, a new producing oil and gas lease in west Texas.

According to the company, the Vago-1 leasehold is located on the eastern shelf of the Permian basin. Certain necessary equipment repairs will add to Treaty’s daily production immediately, and the project has two to three developmental step-out sites to be drilled for new oil production and reserves.

The leasehold is the first of the several targeted lease acquisitions that lie within a large, previously utilized gas storage unit that will be meshed into an overall larger scale Vago project as acquired.

Treaty said that once the acquisition is complete and production from it is commenced, further studies and plans will be conducted for oil recovery measures to be instituted on this project in the existing production units.

Treaty Energy is engaged in the acquisition, development and production of oil and natural gas, primarily in the West Texas Permian Basin. The company acquires and develops petroleum productive properties that are economically beneficial and fit well into Treaty’s program, but not strategic to large exploration-oriented oil and gas companies.