Mosman Oil and Gas Limited (AIM:MSMN) the helium, hydrogen and hydrocarbon exploration, development and production company, is pleased to announce the completion of the acquisition of 82.5% working interest in the Sagebrush Project in Colorado, announced on 30 December 2024. This 82.5% interest will be held by Mosman Helium LLC (a wholly owned subsidiary). The effective date of this transaction was 1 January 2025.
Background on the Sagebrush Project
The Sagebrush-1 well drilled in 1984 tested non-flammable gas (but was not tested for helium) below the salt layer and made an oil discovery above the salt layer. The well’s initial production was in excess of 600 bbls/day of oil and it has cumulatively produced over 300,000 bbls of oil (gross) since coming into production across nine wells, seven of which are producing and two of which are shut-in.
Oil production at Sagebrush has been fairly consistent since 2010, with a gross annual rate of approximately 17,000 bbls from the seven producing wells.
Existing infrastructure includes roads, well sites, wells, separators, storage tanks and a pipeline (which is currently shut in). The lease area has 2D seismic and some 3D seismic which has been used to identify several prospects for both oil and helium.
Planning is already underway for reprocessing of the 2D swath data covering both Sagebrush and Coyote Wash project areas and selective areas of Coyote Wash 3D. Acquisition of approximately 6-8 square miles of new 3D seismic in the most southern portion of the Sagebrush Project is also being planned. It is anticipated the combined cost of the 2D reprocessing and 3D acquisition and interpretation will be in the order of USD 500,000 which will be funded from Mosman’s existing cash resources.
Several leads have been identified in the Ismay formation overlying the salt which is the production reservoir in Sagebrush and in the Roadrunner and Towac oil fields to the west of Sagebrush. There are also large helium prospects in the Leadville formation under the salt. The permitting process for 3D acquisition and drilling will be fast-tracked beginning with the required environmental and historical preservation surveys.
The drilling approval process can take several months and Mosman cannot predict when this will be received but is targeting to drill later in 2025.
Andy Carroll, Chief Executive Officer of Mosman, said: “We are pleased to finalise this important acquisition where we believe there is additional oil potential and significant helium potential. It is a great combination with the adjacent Coyote Wash project 100% owned by Mosman.
“The oil revenue from the producing wells will help fund the ongoing exploration and development program.”
EP-145
Mosman notes Echelon Resources Limited (ASX:ECH) has today updated on its progress re EP-145, further to Mosman’s announcements on 14 and 30 January 2025. The parties have now entered into a formal sale and purchase agreement with completion subject to government approvals: https://www.listcorp.com/asx/ech/echelon-resources-limited/news/ep145-permit-transaction-update-3146808.html
Enquiries:
Mosman Oil & Gas Limited
Andy Carroll
CEO
