Dejour Closes $20MM Kokopelli Joint Venture
Drilling to Commence in Q3 2014 / Company Retires $3.5MM Debt
VANCOUVER, British Columbia--(BUSINESS WIRE)-- Dejour Energy Inc. (NYSE MKT:DEJ / TSX:DEJ), an independent oil and natural gas exploration and production company operating in North America's Piceance Basin and Peace River Arch regions, today announced the Company formed a joint venture with a private U.S. based E&P company (the Partner) to develop its core Kokopelli leasehold in the Piceance Basin region of Colorado. The joint venture will initially focus on developing production from the liquids-rich Williams Fork formation on Dejours southern leasehold with the expectation of drilling a minimum of 8 wells to at least the base of the Williams Fork gas/liquids bearing zone and obtaining an approved Surface Utility Agreement, currently being developed in consultation with the Bureau of Land Management and the Colorado Parks & Wildlife, for the 1,520-acre north lease.
Dejour (DEJ) received ~US$3.75MM at closing and is carried for 25% for US$16MM in drilling, completion and permitting expenditures beginning in August 2014. It is anticipated this funding will carry Dejour through a minimum of eight new wells and extensive facility development on Kokopellis southern leasehold where four natural gas wells drilled in 2013 are currently in production. The Company retains a 25% working interest in the ongoing Kokopelli joint venture and will transfer operatorship of the Kokopelli project to the private US JV Partner resulting in a 70% G&A expense reduction in Dejour USA.
We are pleased that Dejour has closed the joint venture to fund this important development phase of our flagship Kokopelli project and fully retire the C$3.5MM debt associated with the US property, while reducing overhead costs in the US operation. With over 200 drillable locations, 42 drill permits, significant Mancos upside, a well-funded partner, established infrastructure and a strong gas/ liquids contracts in place, we anticipate this Kokopelli joint venture to kick-start a long-term revenue stream for Dejour USA , providing flexibility for continuous bankable project development financing, states Robert L. Hodgkinson, CEO.
About Dejour Energy Inc.
Dejour Energy Inc. is an independent oil and natural gas exploration and production company operating projects in North Americas Piceance Basin (56,500 net acres) and Peace River Arch regions (17,000 net acres). Dejour maintains offices in Denver, USA, Calgary and Vancouver, Canada. The company is publicly traded on the New York Stock Exchange Amex (NYSE MKT: DEJ) and Toronto Stock Exchange (DEJ.TO).
Statements Regarding Forward-Looking Information: This news release contains statements about oil and gas production and operating activities that may constitute "forward-looking statements" or forward-looking information within the meaning of applicable securities legislation as they involve the implied assessment that the resources described can be profitably produced in the future, based on certain estimates and assumptions. Forward-looking statements are based on current expectations, estimates and projections that involve a number of risks, uncertainties and other factors that could cause actual results to differ materially from those anticipated by Dejour and described in the forward-looking statements. These risks, uncertainties and other factors include, but are not limited to, adverse general economic conditions, operating hazards, drilling risks, inherent uncertainties in interpreting engineering and geologic data, competition, reduced availability of drilling and other well services, fluctuations in oil and gas prices and prices for drilling and other well services, government regulation and foreign political risks, fluctuations in the exchange rate between Canadian and US dollars and other currencies, as well as other risks commonly associated with the exploration and development of oil and gas properties. Additional information on these and other factors, which could affect Dejours operations or financial results, are included in Dejours reports on file with Canadian and United States securities regulatory authorities. We assume no obligation to update forward-looking statements should circumstances or management's estimates or opinions change unless otherwise required under securities law.
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Dejour Energy Inc.
Robert L. Hodgkinson, 604-638-5050
Chairman & CEO
Craig Allison, 914-882-0960
Investor Relations New York
Source: Dejour Energy Inc.Copyright Business Wire 2014