HOUSTON, June 29, 2011 (GLOBE NEWSWIRE) -- Holloman Energy Corporation (OTCBB:HENC) updates its shareholders and other interested parties regarding progress in its exploration of the Cooper Basin. On May 11, 2011, Holloman accepted the terms of a preliminary farm-out agreement with Brandenburg Metals Corp. through which Brandenburg can earn a working interest in Holloman's PEL 112 and PEL 444 licenses upon meeting certain milestones. On June 23, 2011, Brandenburg deposited CAD$600,000 in escrow with Holloman in satisfaction of its second and third payments under that agreement. Holloman expects to execute a final and definitive farm-out agreement with Brandenburg shortly.
Holloman also announced it has approved budgets and initiated first steps in Work Area Clearance ("WAC") on PEL 112. WAC is the first step in Holloman's acquisition of approximately 125 square kilometers of 3D seismic data on PEL 112. WAC fieldwork is anticipated to begin in late July or early August 2011.
"The timing of WAC supports our exploration timetable," stated Mark Stevenson, Holloman CEO. "We began solicitation of bids for 3D seismic in May and expect to award that contract within the next few weeks. The completion of WAC in the timeframe anticipated allows us to select the most advantageous schedule for seismic fieldwork to support our drilling plans."
The general terms of Holloman's farm-out include Brandenburg's funding of new 3D seismic and a multiple well drilling program on PEL 112 and PEL 444. In connection with the farm-out opportunity, Holloman has also entered into a participation agreement under which all current working interest holders in the licenses will contribute a portion of their working interest in satisfaction of the 44% working interest which may be earned by Brandenburg. Holloman anticipates it will retain a 40% working interest in its licenses.
Both the farm-out transaction and the participation agreement are subject to a number of conditions including certain approvals, and the execution of definitive agreements.
About Holloman Energy
Holloman Energy Corporation is focused on exploring and producing oil in Australia's Cooper Basin. Holloman's Cooper Basin leases include interests in PEL 112 and PEL 444 which comprise 4,544 Sq km (1.125 million acres) in the southwest and northwest sectors of Australia's prolific Cooper – Eromanga Basin.
Forward-Looking Statements: This press release includes forward-looking statements as determined by the U.S. Securities and Exchange Commission (the "SEC"). All statements, other than statements of historical facts, included in this press release that address activities, events, or developments that Holloman Energy Corporation (the "Company") believes or anticipates will or may occur in the future are forward-looking statements. Such forward-looking statements involve known and unknown risks, uncertainties and other factors, which may cause the actual results, performance or achievements of the Company to be materially different from any future results, performance or achievements expressed or implied by such forward-looking statements. Such factors include general economic and business conditions, the ability to acquire and develop specific projects, the ability to fund operations and changes in consumer and business consumption habits and other factors over which the Company has little or no control. The Company does not intend (and is not obligated) to publicly update any forward-looking statements. The contents of this press release should be considered in conjunction with the warnings and cautionary statements contained in the Company's recent filings with the SEC.
ON BEHALF OF THE BOARD OF DIRECTORS
Holloman Energy Corporation