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Metawells Oil & Gas, Inc. and South Plains Petroleum: A New Era in Oil Development

In a strategic move that could reshape the oil production landscape, Metawells Oil & Gas, Inc. (KOSK OTC Pink), led by Chairman and CEO Ronald Minsky, is on the brink of merging with South Plains Petroleum, Inc. This merger comes alongside an exciting opportunity for investors: South Plains is set to launch a new 10% convertible bond offering.

Funding Development in Texas and Louisiana

The funds raised from these bonds will be channeled towards advancing the development of various oil-producing properties located in the eastern Permian Basin of Texas, as well as establishing a vital saltwater disposal well in south Louisiana. This initiative not only aims to boost production from current sites but also addresses the pressing challenge of managing saltwater byproducts, which have caused several productive wells to remain inactive due to high disposal costs.

The convertible bonds will be available to accredited investors and consist of up to 400 bonds priced at $5,000 each. These bonds will yield a robust annual dividend of 10% and are convertible into 2,500 shares of the company’s common stock, offering investors an enticing prospect for both income and capital growth.

Strategic Advantages and Property Potential

The properties under South Plains Petroleum are promising, particularly in the rich fields of the eastern Permian Basin. The Swenson Ranch oil field, north of Abilene, Texas, is highlighted by its shallow pay areas, which are less than 3,000 feet deep. This field alone has historically produced over 2.6 million barrels of oil! Current estimates by South Plains indicate that the company’s contiguous leases encompass recoverable reserves between 2.25 million to 2.5 million barrels of oil, promising an impressive present value (PV10) exceeding $27 million.

Additionally, the Welch lease within the same oil field is estimated to contain another 800,000 recoverable barrels of oil, valued conservatively at around $20 million in PV10, with around 45 potential development drilling locations identified.

In another promising area, south of Abilene, South Plains has access to another proven field hosting eight drilling sites, with recovering oil reserves estimated at 400,000 barrels—a substantial contribution to the company’s overall portfolio.

Moreover, their Louisiana properties are deeper and high-pressure wells, featuring potential recoverable resources of over 18 billion cubic feet (BCF) of natural gas, along with an estimated 1.8 million barrels of oil, projecting a PV10 value surpassing $35 million. This diversification of assets across Texas and Louisiana places Metawells Oil & Gas in a favorable position for growth and sustainability.

Looking Forward

Both companies have a shared vision of pursuing resource acquisition and development, focusing on established productive basins with proven reserves. This merger is anticipated to accelerate operational efficiencies and expand the production capabilities of both entities.

A Bright Future

The combination of Metawells Oil & Gas, Inc. and South Plains Petroleum, Inc. represents not only an alignment of resources but also a commitment toward innovative development in oil and gas production. In the words of Ronald Minsky, this merger is not just about numbers; it’s about unlocking the immense potential of our combined strengths to foster an energy landscape that is both economically viable and environmentally responsible.

By capitalizing on the current trends in the oil and gas industry, both companies are poised for an exciting future that promises growth for shareholders while ensuring that they are equipped to handle the evolving challenges of resource management.