Houston Natural Resources Acquires Cunningham Energy, Will Change Its Name and Rebrand
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Houston Natural Resources Corp. (HNRC) has completed the acquisition of a 100 percent interest in Cunningham Energy (CE), increasing HNRC’s net asset value $3.35 per share.
The company also previously completed the acquisition of a 9.9 percent interest in Cunningham Energy. The acquisition of the additional 90.1 percent interest takes the company’s total investment in Cunningham Energy to a 100 percent interest. Ryan Cunningham will continue to manage Cunningham Energy. The acquisition was completed through the issuance of common and preferred stock. The purchase price includes an escrow of preferred shares for certain liabilities of Cunningham Energy.
The company intends to change its name from Houston Natural Resources Corp. to Cunningham Natural Resources Corp. (CNRC) and CNRC will be focused on traditional oil and gas opportunities and energy transition materials including mining opportunities in copper, lithium, gold, as well as other precious and rare earth metals. The investment focus will be global with sustainability at the core of the strategy.
An independent engineering firm completed an updated evaluation of the oil & gas assets of Cunningham Energy. The updated independently appraised value of the CE’s leasehold position, as of December 31, 2022, is $352 million dollars, assuming the current proposed sixty-eight (68) well drilling program is completed. The acquisition of the 100 percent interest of CE, in cash and securities, increases the company appraised asset value by $3.35 per share, based on the current shares outstanding.
Cunningham Energy is an independent producer of oil and gas. Cunningham Energy conducts operations and oil/gas interests in the Appalachian Basin with over 30,000 net acres of leasehold. Cunningham Energy was formed in 2008 and was a pioneer of shallow horizontal oil drilling in West Virginia starting in 2014. During its future phase 1 development program in West Virginia, Cunningham Energy plans to permit, drill, and complete twenty (20) shallow horizontal Big Injun, Weir, and Berea sandstone oil wells to fulfill legacy drilling & lease obligations. Identified currently are sixty-eight potential development well sites on existing leases with plans to expand the CE’s leasehold footprint through future acquisitions and leasing.
Cunningham Energy of Canada controls an interest in more than 965,000 acres in the Matapedia Valley, Gaspesie, Quebec Canada from Marzcorp on a 75 percent NRI (net revenue interest) basis through an executed farmout agreement. More than $14 million has been invested in the project to date through collaboration with Marzcorp.
Cunningham Oilfield Services (COS), a division of Cunningham Energy, provides a variety of oilfield services and equipment within the Appalachian Basin. From drilling and support of horizontal and vertical wells to general well service, rigs, and equipment. The recent U.S. Government Bipartisan Infrastructure Deal includes a $16 billion investment in legacy pollution clean-up, including $11.3 billion for abandoned mine land and water reclamation projects and $4.7 billion for orphaned well site plugging, remediation, and restoration activities. Cunningham Oilfield Services projects meaningful participation in the program moving forward which includes recently allocated funds for West Virginia and Texas.
Cunningham Energy will enter into a separate agreement/and or joint ventures with Viper Capital Partners on a deal-by-deal basis for further development of acreage, minerals, and drilling projects in the lower 48 states, including West Virginia, Ohio, Texas, Louisiana, and Illinois.
Houston Natural Resources Corp.. is a diversified energy company with oil and gas interests. The company has recently acquired a 100 percent interest in Cunningham Energy with appraised reserves of $352 million, The company also has minority investments in Rhino Energy, CE Energy Sponsors, and HNR Acquisition Corp. The company will also continue to seek new energy and energy transitions opportunities.
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