Operational Updates | People

Armada Plans Louisana and Niobrara Drilling After Recent Financing

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Armada Oil, Inc., an oil and gas exploration and production company, has reported its ongoing operational activities as well as a reorganization of its management team.

The Company recently announced the closing of an asset reallocation financing transaction with Gulfstar Resources, LLC, a private energy investment group. In addition to providing capital for acquisitions and drilling in other areas, this transaction provided a significant injection of capital into the Company’s south Louisiana operating area.

The first phase of workover activity on the LLDSB # 4 and the LLDSB # 30 has been completed as well as the conversion of the LLDSB # 1 in the Lake Hermitage Field to a salt water disposal well (SWD). The new SWD should be on line in a matter of weeks and should result in a cost savings of $60,000 to $80,000 per month. The initial phase of workover activity on the two wells resulted in increased production and a second round of activity later this month should bring them up to expected production levels. Planning and execution of additional activity in south Louisiana is ongoing.

The significant increase in availability of funds for south Louisiana as a result of the recently closed transaction has generated, and will continue to generate, a high level of activity in the existing south Louisiana fields as well as the potential for additional acquisitions.

In order for those activities to be efficiently and appropriately managed, David L. Freeman has been named President of TNR Holdings, LLC, the subsidiary responsible for all south Louisiana operations and will focus 100% of his time and energy in that operating area. As a result, effective February 16, 2014, Mr. Freeman will no longer serve as Chief Operating Officer of the Company.

As previously announced, Tranche B and Tranche C of the financing transaction totaling $11,250,000 will be dedicated to drilling and additional acquisitions in other operating areas. Preparations are underway to drill the initial Niobrara test well in the Company’s Wyoming operating area in late spring and a number of producing properties are currently being evaluated for acquisition.

Randy M. Griffin, CEO of Armada Oil, Inc. said "We are excited about the ramp up in activity in south Louisiana and look forward to announcing additional acquisition and drilling activities in our other operating areas soon."