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Touchstone Exploration to acquire Trinidad & Tobago exploration blocks for US$7.64 million

Published: 19:03 03 Nov 2010 GMT

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Junior oil and gas exploration outfit Touchstone Exploration (TSX-V:TAB.U) is set to acquire a package of exploration and production interests in Trinidad & Tobago for US$7.64 million.


The deal will see Touchstone acquiring certain Lease Operatorship Agreements related to the Coora block, currently held by Cirrus Energy Corporation and its private Trinidad partner.  Touchstone is also acquiring certain Farm-out Agreements with respect to the New Dome and South Palo Seco blocks, also in Trinidad & Tobago.


The Coora Block consists of two lease operatorship blocks, Coora CO-1 and CO-2 which cover some 1700 acres of land with more than 350 wellbores and associated equipment and production facilities. In 2009 GLJ Petroleum Consultants assigned a Total Gross Working Interest Proved Reserves of 1 million barrels of oil and a Total Proven Plus Probable Reserves of 2.4 million barrels of oil to Cirrus' 49% working interest in these two blocks.


The New Dome and South Palo blocks also include oil production from 2,500 acres of land held under farm-out agreements.  “The areas have well developed infrastructure and good access, and are covered by a 3-D seismic program that is presently being shot,” Touchstone noted.


The three blocks have total production of 300 barrels of medium crude per day.


Collectively the acquired properties produce approximately 300 barrels per day of medium crude. An independent engineering evaluation has identified a “significant inventory of low-risk exploitation and development opportunities.”


The oil & gas junior intends to finance the acquisition through a private placement to raise gross proceeds of US$12.5 million.


FirstEnergy Capital, Paradigm Capital and Haywood Securities are leading the placement.

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