SOURCE: UnionTown Energy Inc.

UnionTown Energy Inc.

April 13, 2011 06:30 ET

UnionTown Energy Inc. (UTOG) Signs Letter of Intent to Acquire 11,000+ Acre Teton River Oil and Gas Property in Northwest Montana

BILLINGS, MT--(Marketwire - Apr 13, 2011) - UnionTown Energy Inc. (OTCBB: UTOG) is pleased to announce that it has signed a non-binding Letter of Intent ("LOI") to acquire the 11,000+-acre Teton River oil and gas property in northwest Montana.

A $100,000 non refundable deposit has been advanced on the signing of the LOI to be applied towards the final purchase price. Terms of the definitive agreement are being finalized and will be announced on closing of the transaction, which is expected to occur within the next 30 days.

The Swift Sandstone oil field is the primary reservoir target. Downdip oil on the Belt Island High was first identified around 1980 and led to exploration efforts in the area.

Two nearby oil fields, the Bannatyne and Utopia, are currently producing from the Swift formation. UnionTown believes that Swift Sandstone displays better porosity, oil saturation, permeability and feet of pay than that evident in either of the nearby fields. Previous exploration wells drilled on the Teton River property have shown positive oil results.

"We are excited to have signed a letter of intent to acquire the Teton River property, which has nearly 28 years of exploration history and shows great medium-term production potential," said UnionTown's President and CEO Darren Stevenson. "The combination of higher overall oil prices in the foreseeable future and recent advances in recovery technologies, such as Steam Assisted Gravity Drainage (SAGD), makes this acquisition very attractive to us at this time."

Teton River is the third Montana oil property that UnionTown has targeted for acquisition in the last month. The first two acquisition targets, Musselshell and New Miami, have already been successfully closed and have combined estimated recoverable oil reserves of 12.8 million barrels over approximately 8,480 acres.

Combined, these properties comprise approximately 8,480 acres and represent an estimated recoverable oil reserve of 12.8 million barrels.

About UnionTown Energy Inc.
UnionTown Energy Inc. is focused on the acquisition, exploration, development and production of oil and natural gas properties. Our strategy is to build a portfolio of energy producing assets in known and producing oil and gas fields throughout North America. With the completion of our acquisitions of the Musselshell Property and New Miami Property, we're moving rapidly to bring the first wells to production. We're also in advanced stages of acquisition of other oil and gas properties, and we have a pipeline of additional potential acquisitions under consideration. For more information about our company, please visit www.uniontownenergy.com.

Safe Harbor
Except for historical information contained herein, the matters set forth above may be forward-looking statements that involve certain risks and uncertainties that could cause actual results to differ from those in the forward-looking statements. Words such as "anticipate," "believe," "estimate," "expect," "intend" and similar expressions, as they relate to UnionTown, the potential reserves, production and ability to establish wells on the Musselshell and New Miami Prospect, identify forward-looking statements. Such forward-looking statements are based on the current beliefs of management, as well as assumptions made by and information currently available to management. Actual results could differ materially from those contemplated by the forward-looking statements as a result of certain factors such as the nature of business negotiations, the operational details of oil and gas properties, the competitive environment within the industry, the ability of UnionTown to expand its operations, the level of costs incurred in connection with UnionTown's expansion efforts, economic conditions in the industry and UnionTown's financial strength. UnionTown does not undertake any obligation to update such forward-looking statements. Investors are also directed to consider all other risks and uncertainties.

Contact Information

  • Contact

    Patrick Smyth
    Director of Corporate Communications
    UnionTown Energy Inc.
    Phone: (702) 530-3241
    Email Contact