As reported in August, the firm completed the deal, which sees it have the right to earn a 75% working interest (WI) in the 6,200 acres.
A third party provided the vendor with C$300,000 as an acreage fee for the first six wells on behalf of Hillcrest, which agreed to re-pay the third party back entirely within one calendar year from closing.
In addition, a fee of 300,000 shares of Hillcrest will be paid to Foremost Capital Corp for their efforts in securing third party funds.
Hillcrest has agreed to undertake an initial six well development drilling program with a maximum commitment of US$3mln.
In August, Don Currie, Hillcrest’s chief executive, said: “.. the acreage obtained as well as surrounding fields have produced oil and gas for decades and are expected to continue to do so through the application of improved drilling and completion techniques, further development and infill drilling.
“The transaction, as structured, allows Hillcrest to drill and develop the acreage at a reasonable pace, and if successful will add substantial production and reserves value to our currently undervalued company.”
He added: “.. the closing of this transaction allows Hillcrest to begin the transition from being primarily a non-operated offshore producer to becoming primarily an onshore project operator.
“We believe that focusing on conventional onshore projects, where Hillcrest is the largest working interest partner and operator, strengthens our ability to create and increase company value.”
Story by ProactiveInvestors