Petrostar enters LOI to develop Sask. oil zones
2008-06-03 08:04 ET - News Release
Mr. Robert Sim reports
PETROSTAR PETROLEUM CORPORATION: LETTER OF INTENT SIGNED TO DEVELOP BAKKEN OIL PLAY IN SE SASKATCHEWAN
Petrostar Petroleum Corp. has entered into a letter of intent with Leaf & Stone Resonance Services Ltd. (L&SRS) of Saskatoon, Sask., to develop certain leaseholds acquired by L&SRS located in southeastern Saskatchewan. The leases will cover up to 12 quarter sections of freehold lands that have been acquired.
The area to be developed has two potential oil-bearing zones; the Frobisher, at a depth of approximately 500 metres, and the Bakken, at a depth of 1,100 metres to 1,400 metres.
Under the terms of the agreement, Petrostar will be the operator and provide up to $250,000 in drilling funds, which matches the technical and mineral rights acquisition costs provided by L&SRS. All future costs will be shared on an equal 50/50 basis.
It is planned to initiate a three-well drilling program, which will commence as soon as permitting and establishment of surface lease requirements for the well site are received. The initial well is to be the first of a potential three-well program designated for the project.
Petrostar is the operator of the project and has retained DJ Craven Oilfield Consultants to supervise and assemble equipment and services to prepare for spudding of the first well. At this time, the intent is to drill the three wells consecutively while the services and equipment are readily available.
The parties will also continue to locate and acquire additional lands within the general area of the Bakken play under the same terms and conditions. More developments will be forthcoming as the project proceeds.
