Tengasco Announces Purchase of Kansas Oil Production and Increase of Borrowing Base Under Sovereign Bank Credit Facility to $11
June 02 2008 - 8:35AM
Marketwired
KNOXVILLE, TN announced today that on May 30, 2008, the Company
signed a letter agreement with Black Diamond Oil, Inc. to purchase
approximately 80 barrels per day of oil producing properties and
related leases and equipment in Rooks County, Kansas for $5.35
million effective on closing. Closing of the purchase is expected
to occur on or before July 1, 2008. The sale includes the purchase
of producing oil wells and saltwater disposal wells, equipment, and
the underlying working interests in leases that have been owned and
operated by Black Diamond for many years.
The Company also announced that on June 2, 2008 the Company has
entered into an amendment to its credit facility with Sovereign
Bank of Dallas, Texas whereby the Company's borrowing base is being
increased by the Bank as a result of its review of the Company's
currently owned producing properties. The Company's borrowing base
is being increased from $7 million to $11 million effective June 2,
2008. The Company has previously utilized approximately $4.2
million of the facility, leaving approximately $6.8 million
available for use by the Company upon this borrowing base increase.
The Company will use $5.35 million of the available $6.8 million
for the purchase of the Black Diamond Oil properties discussed
above.
Tengasco's President Jeffrey R. Bailey said, "We are very
pleased to acquire these producing properties from Black Diamond
which are a good fit with our existing properties in Kansas. This
will immediately add about 80 barrels per day of production to the
approximately 600 barrels per day that we currently produce in
Kansas. Our view of the underlying geology and engineering suggests
we may be able to produce increased volumes from these wells. We
can operate these additional properties with little additional
personnel or equipment needs which will enable us to maximize the
results of our Kansas production staff for the benefit of our
shareholders. We are also pleased that Sovereign Bank has increased
our borrowing base to $11 million, which will allow us to purchase
these properties entirely for the Company's interest and without
involvement of third party participants. In addition, these new
properties have not been considered by the Bank in its borrowing
base review and may support additional borrowing base increases in
the future."
Forward-looking statements made in this release are made
pursuant to the safe harbor provisions of the Private Securities
Litigation Reform Act of 1995. Investors are cautioned that all
forward-looking statements involve risk and uncertainties which may
cause actual results to differ from anticipated results, including
risks associated with the timing and development of the Company's
reserves and projects as well as risks of downturns in economic
conditions generally, and other risks detailed from time to time in
the Company's filings with the Securities and Exchange
Commission.
Contact: Tengasco, Inc. Jeffrey R. Bailey CEO 865-675-1554
Tengasco (AMEX:TGC)
Historical Stock Chart
From May 2024 to Jun 2024
Tengasco (AMEX:TGC)
Historical Stock Chart
From Jun 2023 to Jun 2024