TomCo Energy’s Greenfield enters MoU with cleantech provider Vivakor
The US operating oil development company, (TOM ) said its wholly owned subsidiary, Greenfield, has entered into an agreement with the cleantech provider, Vivakor.
Greenfield and Vivakor have signed a memorandum of understanding that will cover, inter alia, the proposed development by Vivakor of an enhanced oil sands processing plant on the Tar Sands
Holdings II LLC (“TSHII”) site located in the Uinta Basin in Utah, United States. In addition, the MoU will also cover the provision of professional services by Greenfield.
Specifically, the MoU covers a proposed professional services agreement between Vivakor and Greenfield for the potential supply of certain operating and engineering services.
In exchange for its services in respect of the enhancement of Vivakor’s plant, Greenfield will be entitled to receive 50% of net revenues received by Vivakor for any post-processed sand material from the plant sold through offtake agreements procured by Greenfield, it noted.
The company explained that the MoU will include a binding five-year exclusivity period for agreeing and entering into any definitive agreements covering the above mentioned matters.
Vivakor, a business which develops and commercialises clean technologies, has also entered into a lease with TSHII covering around three acres of the TSHII site to accommodate its planned operations, which includes the future supply of oil sands by TSHII, it explained.
Alongside Greenfield, Vivakor intends to develop and enhance a pre-existing oil sands processing plant that it owns on the property. An upgraded plant would be designed to produce at least 1,000 barrels of oil per day or equivalent tonnage of asphalt cement.
Under the lease, TSHII will supply Vivakor with oil sands at a set minimum saturation quality, with a maximum supply of 2,000 tons per day. Vivakor will cover the cost of mining the oil sands and will pay
TSHII $3 per ton of oil sands processed by way of a rental payment; it has already paid a $30,000 advance against future rental payments on signing of the Lease.
TomCo Energy, via Greenfield, currently owns a 10% Membership Interest in TSHII with an exclusive option, at its sole discretion, to acquire the remaining 90% of the membership interests for certain additional cash consideration in the period up to 31 December 2022.
The permits required from the Utah Division of Oil, Gas and Mining to drill three exploration wells on the TSHII site had been received by Greenfield’s wholly owned subsidiary, AC Oil LLC, the company told investors, adding that the drilling of such wells has now commenced.
‘Initial results from the drilling have met the Company’s expectations, with confirmation that no water was encountered in the target formation,’ the company told shareholders this morning.
It said around 120 feet of cores have been produced so far from the first well drilled (AC1) and 80 feet of cores from the second well (AC6); meanwhile, a third well, AC2, is expected to be completed next week, following which tests will be conducted to confirm the oil saturation.
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