Aug 08, 2007 07:00 ET
Westar to Acquire Eagle Oil Position in Truestar Leases
Westar Is Set to Acquire the Working Interest and Operator Position in the Leases of Which Truestar Petroleum Is a Holder; Anticipated $500,000 per Month Increase in Net Income
DALLAS, TX--(Marketwire - August 8, 2007) - Terax Energy (OTCBB: TEXG), soon to be named Westar Oil and Gas Inc, has agreed to acquire the working interest positions and the operator position in the leases which Truestar Petroleum is a working interest holder. The price being paid is 6.3 million dollars cash for both the working interest and the operator's position. This acquisition will allow Westar to become the operator of record and to substantially reduce the operating expenses of the oil and gas operations. Westar is already a major shareholder in Truestar and will over the next several months change the operations in order to reduce the overhead, and streamline the costs of operations. It is expected that this acquisition should allow for an increase in net income by over $500,000 dollars per month. Having control and ownership over both the working interest and the operator position of Eagle will allow Westar to drill and develop the properties at a much faster rate. In addition, this will allow Westar to increase the density of the wells which are being drilled as well as the ability to specifically decide which locations to drill.
Westar has executed with Eagle a final purchase and sale agreement to acquire the interests which are being sold by Eagle. The closing of the transaction is set for August 11th, subject to the approval of Truestar for the change of operator from Eagle to Westar. Westar is a licensed oil and gas operator in Texas.
The closing of the transaction is subject to certain closing conditions, including, among other conditions: (i) receipt of all applicable permits, authorizations, consents, or approvals required consummating the exchange; (ii) neither the Companies having suffered any material adverse effect.
About Terax Energy
Terax Energy is an independent oil exploration and production company. Terax operates with a focus on oil and gas properties located in the Barnett Shale Formations.
This Press Release includes forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Act of 1934. A statement identified by the words "expects," "projects," "plans," and certain of the other foregoing statements may be deemed "forward-looking statements." Although Westar Oil believes that the expectations reflected in such forward-looking statements are reasonable, these statements involve risks and uncertainties that may cause actual future activities and results to be materially different from those suggested or described in this press release. These include risks inherent in the drilling of oil and natural gas wells, including risks of fire, explosion, blowout, pipe failure, casing collapse, unusual or unexpected formation pressures, environmental hazards, and other operating and production risks inherent in oil and natural gas drilling and production activities, which may temporarily or permanently reduce production or cause initial production or test results to not be indicative of future well performance or delay the timing of sales or completion of drilling operations; risks with respect to oil and natural gas prices, a material decline in which could cause the Company to delay or suspend planned drilling operations or reduce production levels; and risks relating to the availability of capital to fund drilling operations that can be adversely affected by adverse drilling results, production declines and declines in oil and gas prices and other risk factors.
Contact:
Taylor Capitol, Inc.
Investor Relations:
Stephen Taylor
973-351-3868
Email Contact
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