KOKO Petroleum, Inc.

KOKO Petroleum, Inc.

October 14, 2005 15:11 ET

KOKO Petroleum Inc. Signs Letter of Intent-Texas

LAS VEGAS, NEVADA--(CCNMatthews - Oct. 14, 2005) - KOKO Petroleum Inc. (PINK SHEETS:KKPT) announced today that it has signed a Letter of Intent with JMT Resources, Ltd. Fort Worth, Texas. KOKO will participate in the Development of JMT's polymer flood pilot program on its 4,000 acre leasehold located in Corsicana, Texas.

The pilot program consists of implementing a polymer based flood in a specific area of JMT's acreage. The 4,000 acre leasehold, known as the Corsicana Field is the oldest oil field in Texas and was discovered in the 1890's by a company that eventually became Mobil Oil.

Due to the production techniques utilized to recover the 20 million barrels of oil (inception to date), which were archaic considering the tools available today, only a small portion of the total oil in place has been recovered. Implementing an alkaline-surfactant-polymer (ASP) flood will cause oil to be "pushed" towards the well bore by creating pressure and fluid movement. In 1988, Tejas Petroleum Engineers prepared an engineering study on the field that estimated the original amount of oil in place in the Corsicana Field was approximately 24,000 barrels of oil per acre. JMT's current acreage block therefore contained 95 million barrels of original oil in place, of which approximately 13% has been produced.

Geological engineering studies have shown that an effective ASP flood could yield as much as 30% to 40% of the original oil in place with lifting costs below $7 per barrel.

KOKO Petroleum Inc. has committed to fund an ASP pilot program in the Corsicana Field, which will cost $1.5 million USD to engineer and implement and consist of drilling approximately 13 wells and subsequently flooding the identified area with ASP. IF successful, KOKO will have the right to participate in the development of the entire field as an equal partner with JMT. KOKO will be responsible for raising the necessary capital to develop the entire field, which is estimated to cost between $7 to $10 million USD.

In addition, the agreement entitles KOKO to conduct 3D seismic on the entire acreage to identify possible deep structures for exploration.

Ted Kozub CEO of KOKO Petroleum Inc. stated the following; "KOKO has an opportunity to become involved with veteran oil people in the development of this field that combines technology with vast resources. We have created a structure that mitigates our downside risk while exposing us to tremendous upside potential. This is an important step in KOKO Petroleum's financial development and we feel it will translate to significant shareholder value."

Certain statements in this news release may contain forward-looking information within the meaning of Rule 175 under the Securities Act of 1933 and Rule 3b-6 under the Securities Exchange Act of 1934, and are subject to the safe harbor created by those rules. All statements, other than statements of fact, included in this release, including, without limitation, statements regarding potential future plans and objectives of the company, are forward-looking statements that involve risks and uncertainties. There can be no assurance that such statements will prove to be accurate and actual results and future events could differ materially from those anticipated in such statements. Technical complications which may arise could prevent the prompt implementation of any strategically significant plan(s) outlined above.

Contact Information

  • KOKO Petroleum Inc.
    Andrea Bleasdale
    Toll Free: 1-888-740-7276