Westmoore has changed its name to Rockwall Holdings and also changed the trading symbol from WSMO PK to RKWL PK. Rockwall (RKWL) has entered into a letter of intent (LOI) to purchase Resource Energy, an oil and gas land drilling service provider, as part of its diversification strategy.
RKWL will purchase Resource Energy for $200,000 and will assume $1m of Resource Energy debt as part of the purchase, the company said.
Following the completion of the acquisition, RKWL will serve the environmental testing and drilling services sectors through its wholly-owned subsidiaries. RKWL expects to generate approximately $2m in revenue from its drilling subsidiary in the first year and expects to produce $700,000 in operating income during the first complete 12 months of operation.
The drilling rigs under acquisition are currently valued at $1.2m. Once acquired, RKWL expects to execute on plans already in place utilizing the knowledge and expertise of the Resource Energy organization to overhaul and recertify the rigs. Once improvements are complete, the rig modifications will bring an increase in their value to approximately $2.4m.
Currently Resource Energy has two drilling platforms capable of drilling up to approximately 5,500ft. Once field ready, these rigs can drill for shallow oil and gas, methane, geothermal testing, CO2 injection, and water wells.
The initial three year revenue model for the drilling subsidiary projects the generation of sales at $10m with a net operating income of $3m. The revenue projections include implementation of an additional drill rig and services specific to the geothermal market.