Tickers: XTSX:DME, PINX:AFQMF
October 15, 2018 / TheNewswire / Vancouver, British Columbia – DESERT MOUNTAIN ENERGY CORP. (the "Company") (TSX.V: DME) is pleased to announce that it has now acquired an additional 3040 acres under lease for helium, oil & natural gas in the prolific Holbrook Basin of Eastern Arizona. The leases were acquired at auction from the Bureau of Land Management of the U.S. Dept. of the Interior ("BLM"). The new leases are situated in Navajo County, Arizona in relatively close proximity to the prolific Pinta Dome Field, which with related nearby fields produced in excess of 9.2 Bcf of helium gas grading 8-10% He from 1961-1976. This now brings the Company’s total acreage under lease in the Basin to 39,742 acres when added to the 36,702 acres already under lease from the Arizona Department of Land. The Company initiated its exploration and land acquisition program in the Basin in the 4th quarter of 2017.
The new leases are highly prospective for helium as well as oil & natural gas. They bring to seven the total number of distinct areas over which leases have now been secured by the Company in the Holbrook Basin. This latest tranche of leases adds acreage to the Company’s existing Woodruff East Area as well as establishing a new area called Pinta Dome North. The leases are characterized by anticlinal features, monoclines and other geological structures with surface expression, together with reservoir rocks and salt and anhydrite caprocks, giving them potential to serve as trapping mechanisms for commercially significant helium reservoirs.
Approximately 2400 acres of the new leases, comprising BLM Lease Parcel ID AZ-2018-09-0386, are in Navajo County in an area called the Woodruff East Area, bringing to 8828 acres the Company’s aggregate lease holdings in this area. It is situated in the NE corner of the Holbrook Basin approximately 12 mi S-SW of the Pinta Dome Field. These new leases directly offset two historic blowout gas wells, NMA #10 and NMA #37, providing the Company with the next permitted well locations under applicable regulations. The reported pressures encountered on each of these two blow out wells is consistent with the pressures initially found on the primary Pinta Dome Field wells.
Approximately 640 acres of the new leases, comprising BLM Lease Parcel ID AZ-2018-09-0418, are located in Navajo County on the north side of the Pinta Dome Field in an area called Pinta Dome North. One portion of this lease parcel is located within the same section only 2500 feet from where the historic Kerr-McGee 1-28 State well was drilled in the SE portion of the section. Production records show that the Kerr-McGee State 1-28 well cumulatively produced 804,961 Mcf of Helium over a 15-year period. At the recent BLM auction price of U.S. $ 279 per Mcf of crude helium, that would equate to a current gross value of approximately U.S. $ 225 Million. Management cautions that there can be no guarantee that future results from offsetting wells will be the same as or similar to historic results. The other lease acreage directly offsets the Kerr-McGee #4 State well, which cumulatively produced 48,233 Mcf of Helium. Records clearly show both the KM #4 State and KM State 1-28 wells were part of the eleven wells comprising the original Pinta Dome Field.
According to Irwin Olian, CEO of the Company, "We are very excited to have been able to acquire these new leases in the Holbrook Basin from the BLM, which now brings our aggregate lease holdings in the Holbrook Basin to 39,742 acres in seven discreet structural areas throughout the Basin. This gives us a lot of drilling options and we are presently at work prioritizing our targets for further exploration and drilling. Our He targets are relatively shallow, permitting us to drill simple vertical wells at low cost with low profile above ground and minimal environmental impact. Consistent with our prior activities in North America and Africa, our team continues to be highly sensitive to environmental and social issues and is designing our work programs to be minimally intrusive."
About Desert Mountain Energy
The Company is an exploratory resource company engaged in exploration and development of helium, oil & gas and mineral properties in the Southwestern United States. Until September 5, 2018, the Company also owned the Yellowjacket Gold Project in Atlin, British Columbia, which it had been developing. The Company has its executive offices in Vancouver, Canada. The Company was incorporated under the laws of the Province of British Columbia, on April 30, 2008, and was formerly named African Queen Mines Ltd. It initially received certain southern African assets in a spin off transaction related to the acquisition of Pan African Mining Corp. by Asia Thai Mining Co., Ltd.
ON BEHALF OF THE BOARD OF DIRECTORS OF
DESERT MOUNTAIN ENERGY CORP.
Chairman & CEO
For more information, contact:
Irwin Olian, President and CEO
Phone: (604) 788-0300
Carrie Howes, Corporate Communications
U.K. – +44 (0) 870 490 5443
Canada – +1 416 900 3634
The TSX Venture Exchange has not reviewed and does not accept responsibility for the adequacy or accuracy of the content of the information contained herein. The statements made in this press release may contain certain forward-looking statements that involve a number of risks and uncertainties. Actual events or results may differ from the Company’s expectations.
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