Dejour Energy Inc., an independent oil and natural gas exploration and production company operating in North America's Piceance Basin and Peace River Arch regions, 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 Dejour’s 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 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 Kokopelli’s 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.
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