Nostra Terra completes acquisition of 80% working interest in Pine Mills oil field, Texas
US and Egypt-focused oil and gas company Nostra Terra has announced its completion of an 80% working interest acquisition in certain oil and gas interests at Pine Mills oil field and associated assets in Wood County, Texas.
Nostra Terra acquired the assets from GFP Texas.
GFP Texas exercised its pre-emption rights after the proposed sale of Pine Mills by its previous owner and operator Cue Resources.
The acquisition includes 15 actively producing oil wells and its production equipment, five storage tanks, four shut in wells, a fully self-contained service rig, a 12-acre works yard and 100% ownership of Pine Mills operator Buccaneer Operating.
In consideration for the purchase, Nostra Terra has paid $1.025m to complete the acquisition, which has been majority financed from existing cash resources with the balance from a loan facility.
A 2,400-acre oil field, Pine Mills currently produces an average of 100 barrels of oil per day. It has no spending commitments attached to it. All leases are ‘Held By Production’ that gives Nostra Terra complete control over future capital expenditure decisions.
The acquisition becomes effective from 1 November, giving Nostra Terra operating rights of Pine Mills.
Pine Mills hosts four oil formations, namely Sub Clarksville, Woodbine Sands, Woodbine Wagoner and Paluxy.
Nostra Terra intends to apply latest oil field technologies and techniques to analyse Pine Mills legacy data that will enable it to identify additional oil reserves from the existing 15 producing wells.
The company also plans to commission an independent assessment of the reserves on Pine Mills.
Nostra Terra CEO said: “The Pine Mills project is a perfect fit for Nostra Terra's strategy. Having reduced our year-on-year running costs by 40% and refinanced the balance sheet through the sale of our interest in the Chisholm Trail prospect, the Pine Mills acquisition represents a significant step forward for the company.
“Our goal has been to acquire assets, which we operate and where we control the pace of development. Pine Mills fulfills both key criteria. With Pine Mills profitable below $30 per barrel, the project will help underpin our business model as we continue to grow the business.
“Since our core US team is based in Texas, Nostra Terra has excellent local knowledge of the operating environment.
"This is now our second acquisition in Texas this year, and we intend to focus our energies on securing more producing assets across this prolific oil region.”