OIL CITY, La., May 26, 2010 (GLOBE NEWSWIRE) -- Black Dragon Resource Companies, Inc.'s ("the Company," "Dragon") (Pink Sheets:BDGR) Chairman and CEO, Mr. Scott D. Smith is pleased to announce that the company has a moved forward with its commitment from interested European investors to fund its Cotton Valley well drilling program. Meetings are scheduled in Europe in the next 2 weeks to finish negotiations with our potential European partners. This project will couple an aggressive acreage acquisition program with the 640-acre lease that Dragon has already in our inventory.
The two shallow wells drilled on this property in December will be tied into a pipeline for gas sales in the near term, as they show good pressure at the well heads. Drilling the Cotton Valley strata on this particular 640-acre parcel is a very attractive investment, because a major oil & gas company drilled a very successful Cotton Valley well on contiguous acreage. This proven well, which was drilled in 2007, flushed in at almost 12 million cubic feet of gas (MMCF) per day, and continues to be highly productive to date. BDGR hopes to mirror this well's results, with its adjacent acreage, as the Cotton Valley is a blanket formation covering much of East Texas and Northwest Louisiana with depths ranging from 9,000-12,000 feet, depending on location. 12 MMCF per day equates to approximately $1,440,000.00 in gross revenue per month at $4.00 natural gas prices. The proposal includes up to eight Cotton Valley wells with a turnkey cost of $30,000,000.00 -- $35,000,000.00; however, upon completion of all eight wells, revenues could gross $107,200,000.00 in the first year.
According to Scott D. Smith, Chairman and CEO, "The potential to derive revenues for shareholders from this project is enormous. Gas wells can have lives in the tens of years and this one project alone long term could equate in well over 1 billion dollars in revenue. We are excited to have found partners who share our vision and look forward to a solid relationship forming between our two groups."
Black Dragon is an oil and gas exploration and production company currently focused on the acquisition of mature, producing and existing domestic oil and gas fields. This focus has eliminated exploration risk, reduced costs of completion, and provided rapid generation of income in a niche market where larger independent and major oil companies are not positioned to compete. Black Dragon intends to recomplete additional shallow producing wells and to expand its focus to include drilling of new wells, some to deeper levels and to purchase additional leases.
Forward-Looking Statements - Safe Harbor:
Certain information discussed in this press release may constitute forward-looking statements within the Private Securities Litigation Reform Act of 1995 and the federal securities laws. Although the Company believes that the expectations reflected in such forward-looking statements are based upon reasonable assumptions at the time made, it can give no assurance that its expectations will be achieved. Readers are cautioned not to place undue reliance on these forward-looking statements. Forward-looking statements are inherently subject to unpredictable and unanticipated risks, trends and uncertainties such as the Company's inability to accurately forecast its operating results; the Company's potential inability to achieve profitability or generate positive cash flow; the availability of financing; and other risks associated with the Company's business. The Company assumes no obligation to update or supplement forward-looking statements that become untrue because of subsequent events.