ZACATECAS, Mexico--(BUSINESS WIRE)--First Colombia Gold (OTCQB: FCGD) (“First Colombia” or “The Company”) is pleased to announce it has signed a Letter of Intent (“LOI”) to acquire a nineteen and a half percent (19.5%) interest in three private oil companies located in south central Kentucky.
The signed LOI outlines the structure of the transaction, which will give First Colombia a working interest in over 50 active producing wells, ownership in 39 active oil and gas leases covering 5,322 acres, as well as full title and ownership to six acres of real estate, which includes a 6800 sq. ft. office complex and maintenance facility. The LOI also includes drilling and operating equipment including two drilling rigs and six completion rigs.
This acquisition will add numerous revenue opportunities and provide cash-flow for operations. The wells being acquired have produced in excess of 8,000 barrels of crude within the last year. The acquisition of the interest in these wells will allow First Columbia to offer a wide variety of contract services including drilling, well completion, pump installation, complete oilfield roustabout services, permitting services, salt water disposal, acid treatments, as well as hauling and logistics services to transport the crude from the customer to the refinery. All of these services are currently being offering by the companies we are acquiring an interest in.
First Columbia’s CEO, Dr. Robert Gates commented, “Acquiring an interest in these wells, along with the real estate and other assets included in the transaction, will prove to be a cornerstone in building our oil and gas portfolio. The wells we are acquiring have a solid track record of production, producing already 8,000 barrels of crude over the last year which we believe can be increased. This is a transaction that has a history of being a performing commercial property, so adding this to our portfolio should prove to be beneficial to our shareholders.”
Gates continued, “Our goal is to be self-reliant and create a vertical business model. Over the last decade, oil and gas production in the U.S. has skyrocketed, especially since the initiative to reduce America's dependence on foreign oil. With U.S. crude oil prices over $100 per barrel, many larger oil companies are looking at Kentucky and exploration activity is rising. Acquiring an interest in oil and gas properties ,and the service capabilities for vertical integration meets our corporate strategy. We are amassing the best properties we can find and assembling the best management team for our stockholders.”
First Columbia’s board and leadership believe that by providing the necessary working capital, and by creating an owner/operator mentality, we can expedite the rework of existing wells and begin new leasing and drilling programs. Preliminary numbers indicate an opportunity to add an additional 22 wells that are already permitted and drilled that can be brought online within the next sixty days.
"We recently announced our plans to acquire a pipeline of oil and gas projects, which we believe have solid potential for building shareholder value. The acquisition of this interest meets that criteria,” commented VP of Merger and Acquisitions Randy Ross. “The companies we are acquiring an interest in have been limited on their oil and gas production, due to lack of capital. Our management and staff have experience in financing public and private companies, and expertise in the extractive industries to build growth in the energy sector through select acquisitions, and improving operating capability.”
About First Colombia Gold
First Colombia Gold Corp. is a capital company focused on acquiring, developing and advancing natural resource, energy, and real estate projects in Europe, North America, and South America. Our business model is to acquire undervalued assets combining potential for building assets values and cash flow through leverage to improved operational efficiencies and development.
Our current activity focus is on precious metal exploration in Montana in addition to planned initial activities of our energy division.
This release contains forward-looking statements that are based on beliefs of First Colombia Gold Corp. management and reflect First Colombia Gold Corp.'s current expectations as contemplated under section 27A of the Securities Act of 1933, as amended, and section 21E of the Securities and Exchange Act of 1934, as amended. When we use in this release, the words "estimate," "project," "believe," "anticipate," "intend," "expect," "plan," "predict," "may," "should," "will," "can," the negative of these words, or such other variations thereon, or comparable terminology, are all intended to identify forward looking statements. Such statements reflect the current views of First Colombia Gold Corp. with respect to future events based on currently available information and are subject to numerous assumptions, risks and uncertainties, including but not limited to, risks and uncertainties pertaining to development of mining properties, changes in economic conditions and other risks, uncertainties and factors, which may cause the actual results, performance, or achievement expressed or implied by such forward looking statements to differ materially from the forward looking statements. The information contained in this press release is historical in nature, has not been updated, and is current only to the date shown in this press release. This information may no longer be accurate and therefore you should not rely on the information contained in this press release. To the extent permitted by law, First Colombia Gold Corp. and its employees, agents and consultants exclude all liability for any loss or damage arising from the use of, or reliance on, any such information, whether or not caused by any negligent act or omission. This press release incorporates by reference the Company's filings with the SEC including 10k, 10Q, 8K reports and other filings. Investors are encouraged to review all filings. There is no assurance First Colombia Gold Corp. will identify projects of merit or if it will have sufficient financing to implement its business plan. There is no assurance that the Company’s due diligence on the potential acquisition of oil and gas assets will be favorable nor that definitive terms can be negotiated. Information in this release includes representations form the private companies referred to which has not been independently verified by the company. A downturn in oilprices would affect the potential profitability of the proposed acquisition negatively.