FRISCO, TX–(Marketwired – December 19, 2017) – West Texas Resources, Inc. (OTC PINK: WTXR), a Texas-based independent oil and gas company, today announced that it has entered into a Letter of Intent to acquire Gas Tap Corp., a privately-held company substantial natural gas reserves in the Barnett Shale, Texas. Pursuant to the Letter of Intent, West Texas Resources will acquire all of the capital stock of Gas Tap Corp. in consideration of West Texas Resources’ issuance of 15 million shares of its common stock to the stockholders of Gas Tap Corp. The Letter of Intent represents the non-binding obligations of the parties and is subject to each party’s continued due diligence inquiry and the execution of definitive agreements between the parties. The transaction is expected to close in early 2018.
Gas Tap Corp.’s primary property consists of shut-in natural gas wells on 1,400 acres located in the Fort Worth Basin. West Texas Resources intends to re-work and re-fracture the shut-in wells. Gas Tap Corp. has obtained an independent reserve study of its natural gas properties that shows an $8 million present value, using a 10% discount rate, of future net income from proved non-producing reserves. Gas Tap has conducted an internal analysis of its assets indicating potential gross recoverable reserves of approximately 20 BCF with a net cash flow of approximately $25 million at current gas prices.
J.D. Kerr, Chief Executive Officer of West Texas Resources, commented, “We believe that Gas Tap Corp. will further our goal of building an asset base of both natural gas and oil production. We believe that the Gas Tap wells and properties have considerable upside and will provide significant cash flow for us.”