Austin announces sale of Mississippi interest

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Oil and gas development company Austin Exploration has completed the sale of its 50% interest in 5 wells in Mississippi for A$1.21 million.

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Austin said the decision to divest of its non-core assets in Mississippi was in line with its strategy to offload projects where it is not operator and has a minority interest, and to focus on developing low-cost oil fields with conventional oil targets.

Austin’s Chief Operating Officer, Mr Tim Hart, said the sale of its Mississippi assets was a great outcome for the company, adding that it had been executed in an “orderly and methodical manner” to achieve the best possible price.

“Through this strategy, and after a sustained effort to streamline operations and lower our cost base, the Company is now well positioned with a strong balance sheet and world class oil & gas assets in Colorado that are owned and operated by Austin,” he said.

The company also announced that operations for its high impact drilling program in Colorado are on track to resume in April.

“The company is targeting oil production from the Pierre formation and a commercial discovery will unlock significant value in this field. The property which lies over the DJ Basin (one of North America’s most prolific oil and gas producing basins), is large enough to accommodate more than 350 wells in the Pierre formation,” Austin said in a statement to the ASX.

“Due to Austin’s strategic low cost drill rig fleet rental arrangement the Company can drill and complete a Pierre well for approximately USD$500,000. This strategic agreement has been designed to significantly decrease costs, increase operational efficiencies and offers optionality over the ongoing development over Austin’s highly prospective 15,282 acre Pathfinder oil and gas project.”