Recon Technology, a non-state owned oil field services company in the PRC, with an established track record of providing highly specialized proprietary software and hardware designed for improved efficiency and automation of the oil extraction process in real-time, reported making a sizeable investment today in Avalon Oil and Gas, Inc. (AOGN).
The deal sees RCON exiting a 2.8M share purchase with 32.22% ownership of all outstanding shares in this domestic developer of oil and gas properties, which also maintains its own noteworthy lead in production enhancement technologies via majority-owned tech group, Oiltek, Inc. Yes, Avalon is not just constructing a portfolio of oil and gas producing properties, they are also constantly pushing the envelope in efficient reservoir maintenance and related tech.
Combining a logistical expansion based on proven and low risk reserves with the technology to generate stable cash flows by reworking previously producing infrastructure, Avalon is an attractive acquisition target with plenty of overlap for RCON. Recon has an established presence in the broader PRC energy game as well, having built up strong foundations through subsidiaries like Beijing Bright petroleum technology Co, Ltd., which has a whole slew of key oilfield technologies under their belt. Additionally RCON works directly with the Oilfield Service and Geology Research Laboratory of Nanjing University, with a deep relationship between their high-tech arm, Recon Technology (Nanjing), Ltd., and this important lab.
CEO and Director of RCON, Shenping Yin, expressed a great deal of excitement over what is RCON's first investment in a U.S. company and reminded investors of Recon's strategic plan to expand well beyond the Chinese market. This is a milestone deal for the company and marks a key turning point for RCON's international development initiative as they reach out to find new ways to satisfy China's growing demand for oil, which remains firm, even amid loss of global market momentum.
It seems that funds from today's announced investment will be applied to completion of the working over of the Moody and West Lease in Duval County, Texas, as well as being applied to the acquisition of additional producing acreage. RCON is quite pleased to add their weight to Avalon's development strategy and forward operational vectors, confident in the knowledge that the array of properties AOGN has under their thumb, powered by the combined oil field services tech know-how of both companies, will yield favorable results for both parties.
Yin doubled-down on RCON's expectations for AOGN and reassured markets that Avalon's ability to continue expanding their portfolio was indeed robust, indicating that we would likely hear more flap about such acquisitive activity in coming months.
To learn more about Recon Technology, visit Recon.cn
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