HOUSTON, July 20, 2020 (GLOBE NEWSWIRE) -- Alpha Energy, Inc. (OTC.PK - APHE) announced today an Option Agreement with Progressive Well Service, LLC to acquire oil and gas assets in Oklahoma in the Coral Project.

Coral Project

The Coral Project is approximately 1,100 acres of developed and undeveloped proven production in the Cherokee Uplift in central Oklahoma. This project area is very prolific and has several (up to 12) additional formations in addition to the Mississippi formation that is currently the producing formation in the 28 wells that make up this project. Logs and drilling data indicate many of these units, which are behind pipe in most wells in the Project, have productive characteristics and provide excellent recompletion targets. The engineering reserve report commissioned by Alpha identifies four behind pipe targets for immediate exploitation. The Project has numerous infill drilling opportunities in the Mississippian, three of which rank as Proven Undeveloped in the reserve report. The greatest potential in the Coral Project may be in the Woodford, a prolific producer in the nearby STACK play area. Log analysis indicates the Woodford has excellent productive characteristics; the reserve report identifies ten Probable locations that adds 1.1 million barrels of oil and over 7 billion cubic feet of natural gas in net reserves per the year-end 2019 independent engineer’s reserve report.

Under the Option Agreement, Alpha has until December 31, 2020 to exercise its option (the “Option Period”). During the Option Period, Progressive may not sell the Coral Project to any third party, in return for which exclusivity Alpha agrees to issue ten thousand (10,000) shares of its common stock, such shares to bear a legend restricting sale during the Option Period. At any time during the Option Period, Alpha may exercise its Option with a cash payment of fifty thousand dollars ($50,000.00). Upon exercising its Option, Alpha and Progressive will work diligently together to enter into a Purchase and Sale Agreement (“PSA”) modeled after the earlier PSA the parties had in place in early 2019, which lapsed due to no fault of either party. Under the new PSA, Alpha shall make a cash payment of six hundred thousand dollars ($600,000.00) to Progressive (the “Project Payment”) and guarantee to Progressive a further payment of 3% of the net revenue stream from any new wells drilled in the Coral Project (the “Production Payment”) until Progressive has received an additional three hundred and fifty thousand dollars ($350,000.00).

The Company notes that the Project is west of the lands in eastern Oklahoma affected by a decision of the U.S. Supreme Court issued on July 9, 2020, McGirt v. Oklahoma, and therefore unaffected by this decision.

Management Commentary

John Lepin, the Company’s Chairman and Chief Financial Officer said, “Our strategy at Alpha is to identify assets that are shallow, have good infrastructure and multiple potential target zones that can be acquired for a competitive price given today’s economic environment. The Cherokee Uplift offers many attractive opportunities to choose from for a company such as ours with little to no debt. The Coral Project fits these criteria nicely, allowing us a quick route to cashflow from existing production and infrastructure that can produce economically even at low commodity prices. Additionally, the Coral Project offers significant upside for us to pursue with new drilling as and when commodity prices improve. Together with the Rogers County Project (see press release of 7/15/20), Alpha will establish a strong base of operations in north-central Oklahoma, with 205 proved locations either currently producing or awaiting re-start and recompletion and an additional 88 proven undeveloped locations. This strategy will allow for the company to offer a generous return on reserves as well as a good dividend to stockholders.”

Alpha Energy, Inc. is a Houston, Texas based, independent energy company engaged in the acquisition, exploration, development and production of crude oil and natural gas. Additional information is available on the Company's website at www.alpha-energy.us.