Trio Petroleum Corp's Strategic Acquisition in Oil-rich Region

Trio Petroleum Corp Acquires Oil and Gas Assets in Canada

Bakersfield, CA - Trio Petroleum Corp (NYSE: TPET), a California-based oil and gas company, has announced an exciting new development. This company has entered into a non-binding Letter of Intent (LOI) aiming to acquire a 100% working interest in specific petroleum and natural gas assets from Novacor Exploration Ltd. in a prominent oil-producing region of Canada. The acquisition is part of Trio's vision to expand its operations into one of North America's most resource-rich heavy oil basins. This strategic move promises considerable potential for long-term production growth and expansion of reserves.

Understanding the Novacor Assets

Located in the Lloydminster heavy oil region, the Novacor properties are positioned in highly prospective areas known for their economic development and operational efficiencies. The properties include two main sites that currently host seven active production wells. These wells are producing heavy crude oil from the McLaren/Sparky and Lloydminster formations. Importantly, the production from these wells is cash flow positive with Freehold Royalties set at 13.5% for Section 19 and 15% for Section 3. The current production averages approximately 70 barrels per day, with plans for additional wells that could significantly boost output.

Potential Production and Financial Upside

Trio Petroleum is optimistic about enhancing the production capacity through re-entries and reactivation of the wells. Two wells in Section 19 are temporarily shut in and stand poised for reactivation, with estimated costs of around C$30,000 each. Upon successful reactivation, these measures could potentially add 10 barrels per day to the overall output, adding a significant boost to the company's production profile. With a total proved and probable oil reserve of about 91.5MBBL, noted in a recently prepared report by Petrotech and Associates, the financial upside in this asset acquisition is substantial.

Strategic Vision and Partnerships

Trio's CEO, Robin Ross, expressed enthusiasm about entering this lucrative market, stating that the heavy oil sector is a foundation for the industry, with opportunities for future expansions. Trio plans to leverage its relationship with Novacor, which has a strong track record of success in oil and gas development, to enhance its operational footprint in the area. The company aims to initiate proactive measures to increase its production, with long-term goals tied to its strategic investments, including noteworthy projects such as the Asphalt Ridge Project in Utah.

Details of the Acquisition

The preliminary financial terms outlined in the LOI place the purchase price at C$2 million, payable in cash and shares of Trio. The cash outlay would total US$650,000, along with further stock compensation intended for registration to facilitate resale. A good faith deposit of C$65,000 was paid to Novacor, which will be deducted from the final purchase amount. It's important to note that the LOI will set the stage for more detailed agreements, where standard representations and warranties will be established, along with conditions necessary for the transaction to proceed. This includes requiring both parties' boards of directors' approval and ensuring Trio has adequate financing in place to finalize the acquisition.

About Trio Petroleum Corp

Trio Petroleum Corp is an innovative oil and gas exploration and development enterprise founded in Bakersfield, California. The company has key operations in Monterey County, California, and Uintah County, Utah. In Monterey County, Trio maintains a stronghold over an 85.75% working interest in over 9,200 acres in the Presidents and Humpback oilfields and a 21.92% interest in the McCool Ranch Field. Furthermore, in Uintah County, Trio holds a 2.25% working interest across 960 acres and has options to significantly increase its stake in prospective areas.

Frequently Asked Questions

What is Trio Petroleum Corp’s recent acquisition?

Trio Petroleum Corp is acquiring a 100% working interest in petroleum and natural gas properties from Novacor Exploration Ltd. in Canada.

What is the significance of the Lloydminster heavy oil region?

The Lloydminster heavy oil region is known for its economic potential, making it one of North America's top areas for oil production and development.

How many wells are currently producing oil from the Novacor assets?

There are seven active production wells on the Novacor properties, with further potential for increased production through new well re-entries.

What are the financial terms associated with the acquisition?

The acquisition has a stated purchase price of C$2 million, which includes cash payment and common stock shares of Trio Petroleum.

What is Trio Petroleum's future growth strategy?

Trio aims to aggressively grow its operational footprint while leveraging partnerships and exploring new investment opportunities that promise cash flow and transformative growth.

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