West Texas Resources, Inc. (OTCQB: WTXR), a Texas-based independent oil and gas company, today announced its sale of 44.1% of its working interest in the Port Hudson field to EnTek Partners, LLC for total consideration of $290,000. In August 2013, West Texas acquired a 7.24625% working interest (5.65158% net revenue interest) in the oil and gas leases, wells and attendant production in the Port Hudson field, Baton Rouge Parish, Louisiana, for total consideration of $702,900. Pursuant to its agreement with EnTek Partners, West Texas sold to EnTek an undivided 3.1956% of 8/8ths working interest (2.4926% net revenue interest) out of the working interests in the Port Hudson field owned by West Texas. After giving effect to the sale, West Texas continues to hold a 4.0506% working interest (3.1595% net revenue interest) in the Port Hudson field, which has estimated remaining recoverable reserves of 444,477 bbls (gross), and 14,043 bbls (net to West Texas) as of January 1, 2014.
Pursuant to the same agreement, EnTek Partners has also agreed to provide to West Texas up to $275,000 in non-recourse financing to pay for West Texas' share of a dual recompletion in the D-1 well at its West Cam 225 property in exchange for West Texas's agreement to provide EnTek Partners with 75% of the net profits derived by West Texas from the West Cam 225 property until such time as EnTek Partners has recouped 100% of the recompletion costs advanced on behalf of West Texas and 50% of the net profits thereafter.
According to Stephen Jones, President of West Texas Resources, "We are very pleased with our agreement with EnTek Partners. The $290,000 we received for the sale of the partial interest in the Port Hudson field, plus the production payments from the Port Hudson field we have received to date, exceeds our total investment in the Port Hudson field, and we still retain a 4.0506% working interest (3.1595% net revenue interest) in the project. We are also pleased with our ability to leverage our profit participation in the West Cam 225 field in order to finance our share of the recompletion costs on a risk free basis. We look forward to engaging in additional creative financing transactions of this nature in the future."