13th May 2020 07:33
(Alliance News) - Attis Oil & Gas Ltd on Tuesday said it has completed the disposal of subsidiary Northcote Cleveland LLC, holder of the Zink Ranch lease in Oklahoma.
Northcote Cleveland was bought by a consortium including Paolo Amoruso, Attis's executive chair, for USD250,000 in cash, plus assumption of a USD50,000 operator's bond. Amoruso bought a 20% interest in Northcote Cleveland.
Furthermore, Attis has disposed of its interest in the Fort Worth field in Texas for a nominal amount plus "the relinquishment of the bond associated with the field for the assumption by the buyer of the plugging and abandonment and tax liabilities on the 98 wells on the field".
Attis reiterated that its Fort Worth joint venture partner, APEG, had failed to meet financial obligations and that the field has been operating at a loss due to "historically low natural gas prices in the US".
In addition, Attis pointed out that by disposing of the field, it avoids plugging and abandonment liabilities - presently estimated to be USD25,000 per well.
In the six months ended June 2019, Zink Ranch contributed no revenue to Attis and was carried on the balance sheet at USD500,000. Attis's interest in Fort Worth contributed USD229,921 of revenue in the same six month period, had cost of sales amounting to USD79,219 , and was carried on the balance sheet at USD2.0 million.
"The company is still the owner and operator of the Austin Field in Texas. Production at the field is currently shut-in given the oil price environment. The proceeds from the disposals above will be used for general working capital purposes," Attis said.
By Anna Farley; [email protected]
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