Houston-based Rocky Mountain Energy Corp. said Friday it has closed on the acquisition of the 8,000-acre Ten Mile and Desert Spring Fields located in Sweetwater County, WY. The company said there are five current wells producing 1,000 Mcf/d of natural gas and 67 bbl/d of oil.

Rocky Mountain said the leases contain 56.4 Bcf of proved reserves net to its interest located in Fort Union and Wassatch Coals. The company added that drilling of up to 100 development wells is expected. It estimated cash flow upon development of the first 30 wells ($3 million of development cost) is expected at $600,000 per month net to Rocky Mountain.

Under the terms of the agreement, Rocky Mountain said it paid $3 million for acquisition and will spend an additional $3 million in development, drawing down on its $40 million credit line with Marathon USA Corp. The company is drawing down $11 million of the line for acquisition and development of two other fields recently purchased.

Just last month, Rocky Mountain purchased the assets of BC&D Oil and Gas Corp. for $4.5 million. The company paid $2.5 million in cash and $2 million in Rocky Mountain stock. BC&D’s assets are located in Hospah, NM, 75 miles southeast of Farmington, NM. Rocky Mountain estimated its net current production at 300 bbl/d, with eleven gas wells slated for completion, which have been tested at rates ranging from 4,000-6,000 Mcf/d.

“This is our first acquisition since we became public and we expect to demonstrate to investors how quickly we can increase oil and gas production from BC&D’s assets,” said Paul Bornstein, chairman of Rocky Mountain Energy. “In this current oil and gas pricing environment we could generate $1,000,000 net cash flow per month in the near-term.

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