SOURCE: Matrixx Resource Holdings, Inc.

February 28, 2011 08:38 ET

Sanger Heirs #1 Site Preparation

HOUSTON, TX--(Marketwire - February 28, 2011) - Matrixx Resource Holdings, Inc. (PINKSHEETS: MXXH), announced today that it has been notified by Tejones Operations Corporation that preparation has begun on the Sanger Heirs #1 Site.

Matrixx has been informed that work has begun on building the one and one half mile road required to reach the drill site of the Sanger Heirs #1. Upon completion of the road, the lease service company will commence the construction of the drilling pad and digging the reserve pits. Additional progress on the site will be updated as information becomes available.

The Company filed Form 8K on February 25, 2011 on the Completion of Acquisition of Assets that it acquired a 25% working interest in an 82.2 acre oil and gas lease known as the Sanger Heirs #1 from Tejones Operating Company. Pursuant to the terms of the Agreement, the Company purchased a 25% working interest in the Sanger Heirs #1 lease in exchange for $200,000 of restricted shares of the Company. The $200,000 payment includes the Company's prospect fee and dry hole costs up the casing point. The lease is an 82.2 acre oil and gas lease in Live Oak County, Texas. The terms of the Agreement further obligate the Company to pay its proportionate share of the completion cost of the well.

The Sanger-Heirs (Wilcox) Prospect is located northeast of the Rhode Ranch East Field. This field has produced 53 BCF of gas from the Upper Wilcox sand. The 7 Slick Sand wells produced 50.3 BCF of gas. The Rhode Ranch East Field is located between two down-to-the-coast growth faults. These faults created a large anticline structure that trapped the Upper Wilcox Sand section. A second major Upper Wilcox field was discovered northeast adjacent of the prospect in Elms Field. It is on strike with our prospect and East Rhode Ranch Field. The 7 best Slick wells in this field produced 43.6 BCF of gas. The field is similar to Rhode Ranch East in that it is located between two down-to-the-coast faults and is of similar size. A third Wilcox Slick Sand field is located east and adjacent of the prospect. This is a small field consisting of 4 wells drilled deep enough to test the Slick Sands. The three best wells in this field produced 7.2 BCF of gas. This trap is an upthrown closure against the eastern most fault. There is a structural reversal of dip between this field and the Hanson-Sanger 1-B well. This well traps in the Slick Sand against an up-to-the-coast fault seen on seismic. A fourth Wilcox Slick Sand field is south of the acreage in Cloeter and Sanger Ranch Fields. Each field has one well, which produced in the Slick Sand. These two wells produced 3.27 BCF of gas out of an anticline bordered to the west by a substantial up-to-the-coast fault.

The prospective anticline is bordered to the northeast by Arco-Riser #3 well and the M.P.S. Prod.-Riser #3. The top of the Slick Sand is at -6833' and -6808' respectively. This shows a 25 foot gain of structure to the southwest. On the southwest side of the structure the Southland-Sanger #1 well was drilled and the top of the Slick Sand came in at -6836'. This being flat to the Arco-Riser #3 well is less than one mile to the northeast. On the east side of the drill site there is a small down-to-the-coast fault seen seismically and in the Arco and M.P.S. producing wells. East of this north/south fault is a substantial up-to-the-coast fault seen seismically. This fault is believed to have created the hydrocarbon trap responsible for the gas production found in the Hanson-Sanger #1-B well. The four wells previously mentioned are believed to be on the flanks of an anticline that crests near the proposed drilling location.

The 3-D seismic data show the structural high to be tested by this prospect to be 62' high to the M.P.S. producer - Riser #3 well, which is the highest well on this anticline. There is approximately 100' of Slick Sand and about 50' of Luling WX Sand found in this well. There is a high probability that Slick Sand will have a productive column of gas of 40' to 50' of sand at the top of the structure. Also the Luling WX Sand could have 20 plus feet of pay sand. The productive Slick Sand sections in the best producing wells of East Rhode Ranch and Elms Fields had pay sections over 100' thick and produced 10 plus BCF of gas per well.

The Sanger Heirs #1 well sits on the Wilcox Sands. Said sands in this area are very prolific producers and do not require any type of stimulation to get the maximum reserves from the reservoirs. Tejones expects to encounter multiple pay zones in the aforementioned well as much as 60 to 100 feet of pay.

The Wilcox formation is known to produce an average of 600 barrels of oil per acre foot. For example, in 2007, the US Geological Survey estimated that there are 110 million barrels of un-discovered oil, and approximately 3 trillion cubic feet of gas and over 500 million barrels of natural gas liquids throughout the Wilcox formation.

Safe Harbor Statement: This press release contains forward-looking statements as defined in The Private Securities Litigation Reform Act of 1995 (the "Act"). In particular, when used in the preceding discussion, the words "plan," "confident that," "believe," "scheduled," "expect," or "intend to," and similar conditional expressions are intended to identify forward-looking statements within the meaning of the Act and are subject to the safe harbor created by the Act. Such statements are subject to certain risks and uncertainties, and actual results may differ materially from those expressed in any forward-looking statement. Such risks and uncertainties include, but are not limited to, the ability of Matrixx to complete the proposed acquisition(s), the results of Matrixx's due diligence review of the candidate(s), the success of the business of the acquisition candidate(s), including the ability of Matrixx to continue to sell the applicable products and the acceptance of those newly designed products by the market, market conditions, the general acceptance of the Company's products and technologies, competitive factors, timing, and other risks described in the Company's SEC reports and filings.

Contact Information

  • Media & Investor Relations:
    Alex Livak
    Tel: 917-239-6800

    Matrixx Resource Holdings, Inc.
    2150 Latigo Canyon Rd
    Malibu, CA 90265
    Ph: (917-239-6800)