TomCo Energy plc (TOM), the US operating oil development group focused on using innovative technology to unlock unconventional hydrocarbon resources, is pleased to provide an update on certain recent developments in connection with the Company's plans for a potential commercial scale project on the mining properties comprising the Tar Sands Holdings II LLC ("TSHII") site located in the Uinta Basin, Utah, United States . As previously announced, TomCo's wholly owned subsidiary, Greenfield Energy LLC, ("Greenfield"), owns a 10% Membership Interest in TSHII with an exclusive option, at its sole discretion, to acquire the remaining 90% of the Membership Interests for additional cash consideration up to 31 December 2022.
TSHII Drilling Update
The Company is pleased to report that the permits required from the Utah Division of Oil, Gas and Mining to drill three exploration wells on the TSHII site have now been received by Greenfield's wholly owned subsidiary, AC Oil LLC. The drilling of these exploration wells is now scheduled to start in early March 2022.
Third Party Lease
TSHII has entered into a 10 year lease with a tenant starting from 1 March 2022 covering an existing refinery on the TSHII site that is not required for Greenfield's plans and was previously scheduled to be demolished should Greenfield acquire 100% of TSHII. The tenant intends to develop a 10,000 barrels of oil per day refinery on the site and under the terms of the lease has two years in which to do so without potentially forfeiting the lease.
The lease requires the tenant to pay TSHII US$10,000 per month as a monthly rent, together with a further US$3 production rent on every barrel of produced hydrocarbons.
Commenting, John Potter, CEO of TomCo, said : "We continue to make significant progress with our plans for the TSHII site and we look forward to the drilling of the exploration wells in March, utilising some of the proceeds from our recently completed placing. In parallel, we are progressing the previously announced due diligence exercise being undertaken by a financing party currently interested in backing our plans for Greenfield, together with other matters in relation to the TSHII site. We look forward to providing further updates in due course."