Good Evening,
Just wanted to provide a quick update on news released by Covenant Resources late this afternoon. I mentioned in my last update that we should be hearing about a property acquisition soon and today was the day. The press release is shown below. I'll have a more complete update out in the next week but wanted to note a few key points. If you have some time, please listen to the Rosetta Resources 2ndQ conference call at the following link;
http://ir.rosettaresources.com/eventdetail.cfm?eventid=84092
In it, you'll hear how they have been testing their verticals in their Alberta Basin Bakken play and have determined that they believe they can access more than one of the Three Forks, Bakken and possibly Banff formations all with one horizontal frac which greatly improves the potential economics of the play. They also indicated that acreage on the Canadian side of the play went for nearly $1,800/acre at the last crown sale. Covenant just added 41,000 net acres that they feel are prospective for the bakken. Shares are trading at $.20/share for a current market cap of $4 million.
http://www.covenantresources.com/pr/aug11.php
Covenant Resources announcing signing of LOI for Acquisition of Oil and Gas Properties
August 11, 2010 - Vancouver, British Columbia
Mr. Frank Port, President and CEO of Covenant Resources Ltd. (the "Company") (CNSX:CVA), wishes to announce the signing of a Letter of Intent ("LOI") with Damont Energy Inc. for the acquisition of oil and gas leases in Montana.
The LOI outlines the terms of the acquisition of all of Damont's right, title and interest in 41,500 net acres of oil and gas leases in "The SweetGrass Arch" Prospect located in Toole and Pondera Counties, Montana. The cost of the acquisition will be approximately $3.8 million, based on the issuance of approximately 19,000,000 shares of Covenant at a deemed price of $0.20 per share. Upon completion of due diligence and final negotiations, a definitive purchase agreement will later be entered into.
The Company is a junior natural resource exploration company focused on the acquisition, exploration, and development of economically viable natural resources. The Company continues to seek additional natural resource opportunities including properties that may lead to oil and gas exploration or any other opportunities that may fall under "natural resources" sector.
The Company Trades on the CNSX under the trading symbol "CVA".
The CNSX does not accept responsibility for the adequacy or accuracy of this news release.
For more information, please refer to the Company's prospectus and engineering report available on SEDAR (www.sedar.com).
On Behalf of the Board of Directors
Mr. Frank Port
President, Chief Executive Officer, and Director
Again, I'll have an update out providing additional details later in the week.
Sincerely,
Vince Marciano
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