REDHILL ANNOUNCES DRILLING ACTIVITY ON GORR LANDS
Redhill royalty grantor High North starts drilling well
2014-11-05 09:05 ET - News Release
Mr. Paul McDougall reports
REDHILL ANNOUNCES DRILLING ACTIVITY ON GORR LANDS
Redhill Resources Corp. has received notice from High North Resources Ltd. announcing the commencement of drilling the first well on the Redhill GORR (gross overriding royalty) lands. The GORR lands comprise the seven-section Montney lease block in which Redhill sold a 100-per-cent working interest to High North for cash consideration and a 2.5-per-cent gross overriding royalty payable to Redhill, as announced on April 22, 2014.
In a news release dated Oct. 28, 2014, High North announced the commencement of drilling a well located at 8-9-76-21W4 in the Girouxville-McLeans Creek area of Alberta. High North expects this well to extend the Montney oil pool boundary and increase its inventory of horizontal drilling locations on its land. Many of these new potential drilling locations would be located on the Redhill GORR lands should the Montney pool boundary be extended.
Under the terms of the GORR agreement, High North will pay Redhill a 2.5-per-cent GORR calculated before operating expenses are deducted on all hydrocarbon sales from the 8-9-76-21W4, should it prove to be successful. High North is responsible for 100 per cent of the drilling and operating costs for the new well.
Additionally, on Oct. 31, 2014, a definitive agreement with Petrel Robertson Consulting Ltd. was executed related to the Chinook prospect as contemplated in the Redhill news release of Sept. 25, 2014.