Dejour Energy Inc. (NYSE MKT: DEJ, TO: DEJ.TO) formed a joint venture (JV) with a private U.S. exploration and production company, Dejour said June 30. The JV will support the production from the liquids-rich Williams Fork Formation in the Piceance Basin on Dejour’s Kokopelli lease, the company said.
Dejour plans to drill at least eight wells to the base of the Fork’s gas- and liquids-bearing zone, the company said. The Williams Fork is on Dejour's southern leasehold, the company added.
A Surface Utility Agreement, for the north lease's 1,520 acres, is being developed with the Bureau of Land Management and Colorado Parks & Wildlife, the company said.
Dejour received about US$3.75 million at closing, the company said. A total of $16 million in drilling, completion and permit expenditures should support the eight wells and development of facilities, the company said. Dejour “is carried for 25%” of the $16 million, the company noted.
Dejour has a 25% working interest in the JV and will transfer ownership of the project to the private partner, the company said. This will reduce Denver-based Dejour USA’s general and administrative expenses, the company said.
“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 CA$3.5MM debt associated with the U.S. property, while reducing overhead costs in the U.S. 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 kickstart a long-term revenue stream for Dejour USA , providing flexibility for continuous bankable project development financing,” said CEO Robert L. Hodgkinson.
Vancouver, British Columbia-based Dejour Energy Inc. explores and produces oil and natural gas in North America.
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