Jun 14, 2010
Doxa Increases Its Eagle Ford Shale Oil & Gas Interests In South Texas And Updates Operations
VANCOUVER, BRITISH COLUMBIA - Doxa Energy Ltd. - TSX Venture Exchange DXA. - ("Doxa" or the "Company"), announced today that it has more than doubled its net holdings within the oil & gas condensate windows of the Eagle Ford Shale trend of South Texas.
Eagle Ford Shale Additions and Update
The Company's recent Eagle Ford Shale interest acquisitions, when combined with the original Peeler Project acreage (see Doxa news, May 25, 2010), gives Doxa working interests ranging from 14% to 20% under 4,832 gross acres. The new properties are situated in Atascosa, McMullen and Zavala Counties. The Company also reports that it is in negotiations to acquire additional significant participation interests throughout the Eagle Ford Shale trend, and once finalized, it will outline details on the result of this effort. The Eagle Ford Shale is a prolific new oil & gas play that is transforming a wide swath of South Texas in to one of the most active resource plays in the US.
Doxa announced that the new acquisitions include a 15% working interest (11.25% net revenue interest) in the 640 acre Epley project in McMullen County, Texas, operated by San Isidro Development Company. Drilling operations on the initial horizontal well (the "Epley No. 1H") have been commenced and will be targeting the gas condensate window of the Eagle Ford Shale formation below 11,000'.
As previously reported in connection with the Peeler Project, Doxa expects drilling operations to commence on the initial horizontal well targeting the Eagle Ford Shale in third quarter, 2010. Based on projected well spacing as reported by EOG Resources on its contiguous Eagle Ford Shale project, Doxa is estimating that as many as 14 wells will be completed on the Peeler Project (based on 140 acre spacing). On this basis Doxa expects that over 35 gross wells could ultimately be drilled on acreage under which it now owns interests. The Company also believes that activity and reserve estimates recently disclosed by EOG and other operators on projects proximate to its acquired acreage continue to de-risk the play and support the prospective per well recovery estimates set out in the Graham Report for the Peeler Project.
Update on Other Projects
Additionally, Doxa is also pleased to report that it has agreed to sell a portion of a 1,032 acre lease block it previously acquired in the Edwards trend that it does not consider to be strategic. Profit from the sale net to the Company is expected to be approximately US$414,327 with closing scheduled to occur this month. The Company expects to drill an Edwards formation test on the retained portion of the acreage block later this year.
Finally, Doxa announced that it participated for a 6.25% working interest in the drilling of the Vitera No. 1 in Wharton County, Texas. The Vitera No. 1, which was drilled to total depth at 15,534', targeted various Wilcox formation objectives which did not develop as expected, and the well is scheduled to be plugged and abandoned as a dry hole. The Company does not expect to participate in additional drilling operations on this prospect at this time.
The Company advises that that it has granted incentive stock options to certain officers and consultants entitling them to purchase up to 269,000 common shares of the capital stock in the Company at a price of $0.38 per share until June 11, 2015. The above is subject to regulatory approval.
John D. Harvison
President, Chief Executive Officer
For further information contact: Scott Parsons Director or Paul McKenzie Director 604.642.2625 or visit www.doxaenergy.com
Neither TSX Venture Exchange nor its Regulation Services providers (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.
Statements in this press release other than purely historical information, including statements relating to the Company's future plans, objectives or expected results, constitute forward-looking statements. Forward-looking statements are based on numerous assumptions and are subject to the risks and uncertainties inherent in the Company's business, including risks inherent in oil and gas exploration and development, and uncertainties in connection with anticipated commodity prices for oil and natural gas, growth of worldwide market demand, exploration capital requirements, length of asset life and availability of qualified personnel, among others As a result, actual results may vary materially from those described in the forward-looking statements.