General News | Oilfield Services

American Petro-Hunter to Aquire Eagle Ford Housing Biz

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American Petro-Hunter Inc. has reported plans to introduce a new management team and seasoned Board of Directors to reflect the company's new strategy, which is to build a holding company focused on energy and real estate investments.

The new company will be renamed and seek to develop, acquire and operate hard assets that we expect will provide attractive and tax efficient cash flow as well as future price appreciation. We believe this current to near term cash flow investment focus will allow the company to establish a consistent cash distribution to its shareholders. In line with that strategy, the new company may explore a conversion to a limited liability company or other corporate structure to tax efficiently provide any cash distributions to its shareholders. 

The Company is currently in negotiations to acquire a workforce accommodation facility that services utility and oil service companies operating in the Eagleford region of Texas. The property is fully utilized and we estimate it generates approximately $800,000 in pretax annual cash flow. Upon closing, we expect to further develop this property and add additional units to this accommodation facility with the intention of increasing the property's annual cash flow to $1.6 to $1.8 million. The Company seeks to finance such transactions primarily through the use of debt financing. In addition, the Company intends to pursue other identified locations in various oil producing regions to develop similar workforce accommodation facilities that are both "closed" and "open" camps focused on the energy industry. The Company also plans to acquire and develop income producing oil service yards and other properties that are located in energy producing regions such as South and West Texas.

In addition to real estate assets, the Company will acquire, explore for, develop and produce crude oil and natural gas properties located in the U.S. through operated and non-operated direct investments in addition to funding from retail investment programs. The Company, however, will not pursue the development of the Kansas oil and gas properties previously announced as we expect the acquisition of the Eagle Ford workforce accommodation facility to present more consistent cash flow, which we believe will represent a more advantageous long-term return to shareholders. The Company may also opportunistically acquire debt and equity of public and private companies that are energy or real estate related.