CALGARY, ALBERTA--(Marketwire - Nov. 15, 2012) - John E. Squarek, President and CEO, advises that MGold (TSX VENTURE:MNI) has signed a participation agreement to pay $1,000,000 to re-enter and place on production an existing Devonian D-3 oil well in early 2013. Under the terms of the agreement, MGold will receive 85% of the revenue before payout of the well, and 55% after payout. MGold will also receive a 55% working interest in 1 producing gas well, and 3 shut-in gas wells. The property also has other shallower potential.
MGold expects the well to produce 120 barrels per day net to MGold for the first year. At this rate, the well should payout in less than 1 year. Cash flow from the well will enable MGold to drill a second well in late 2013. Expected reserves to MGold's interest are estimated at 445,500 barrels on primary production, with the possibility of an additional 370,000 barrels under secondary recovery. MGold will be pursuing a variety of financing opportunities to fund this project.
Mr. Squarek advises that MGold is continuing its review of other prospects and hopes to be able to report further progress in this regard within the next 3 months.
Forward Looking and Cautionary Statements
This news release contains certain forward‐looking statements (forecasts) under applicable securities laws relating to future events or future performance. Forward‐looking statements are necessarily based upon assumptions and judgments with respect to the future. In some cases, forward‐looking statements can be identified by terminology such as "may", "will", "should", "expect", "projects", "plans", "anticipates" and similar expressions. These statements represent management's expectations or beliefs concerning, among other things, future operating results and various components thereof affecting the economic performance of MGold. Undue reliance should not be placed on these forward‐looking statements which are based upon management's assumptions and are subject to known and unknown risks and uncertainties, including the business risks discussed above, which may cause actual performance and financial results in future periods to differ materially from any projections of future performance or results expressed or implied by such forward‐looking statements. Accordingly, readers are cautioned that events or circumstances could cause results to differ materially from those predicted. These statements speak only as of the date specified in the statements.
The Company's actual results could differ materially from those anticipated in the forward looking statements contained throughout this news release as a result of the material risk factors set forth below:
- volatility in market prices for oil and natural gas;
- liabilities inherent in oil and natural gas operations;
- uncertainties associated with estimating oil and natural gas reserves;
- geological, technical, drilling and processing problems; and
- general business and market conditions.
These factors should not be construed as exhaustive. Unless required by law, the Company does not undertake any obligation to publicly update or revise any forward looking statements, whether as a result of new information, future events or otherwise.
There is no certainty that any portion of the resources will be discovered. If discovered, there is no certainty that it will be commercially viable to produce any portion of the resources.
Neither the TSX Venture Exchange nor its Regulation Services Provider (as the term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.