Alaska Acreage Summary
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In 2015 Royale released the following statement on it Alaska opportunity.
ROYALE TO MONETIZE PORTION OF ALASKA ACREAGE San Diego, November 10, 2015 – Royale Energy, Inc. (NASDAQ: ROYL) today announced it entered into an agreement to sell a portion of its Alaska acreage for cash and a retained interest. Royale will receive $2 million in cash and retain an Overriding Royalty Interest in exchange for a 100% Working Interest in its Western Block consisting of approximately 39,500 acres. The sale is subject to approval by the state of Alaska. In December 2011, Royale acquired 96,000 acres of leasehold acreage on the Alaskan North Slope. Over the following four years, the Company acquired and processed 3D seismic data, further positioning the acreage for development. Following the transaction, Royale will retain 57,000 acres for which it is evaluating alternatives including similar de-risking, sale, or joint venture. Royale considers this sale a key step in its plan to strengthen its balance sheet and regain compliance with NASDAQ listing requirements. A portion of the sale proceeds will be used to fund Royale’s upcoming drilling campaign scheduled to begin in December 2015.
Update in 2020
Today, Royale retains an ORRI of 1.5% in the Horseshoe Unit area of the North Slope, Artic Ocean, Beaufort Sea. The Horseshoe Unit offsets the Pikka Unit in the North Slope which is currently scheduled for commercial development (source: www.oilsearch.com, Oil Search Alaska). This area is noted by numerous production projects and the location of the National Petroleum Reserve (NPR-A) and Alaska National Wildlife Reserve (ANWR). The Horseshoe Unit, as a potential development project, remains a potential future asset for Royale as companies in the area delineate resources and determine commercial viability.
Simplified Summary
In 2015, Royale Energy sold part of its land in Alaska. The company received $2 million and kept a small royalty interest, which means it may earn money if oil or gas is produced there. Royale first bought the land in 2011 and studied it for several years. After the sale, the company still owned 57,000 acres and looked at options for selling or partnering on the rest. The sale helped improve Royale’s finances and supported new drilling planned for late 2015. In 2020, Royale still had a 1.5% royalty interest in an area called the Horseshoe Unit on Alaska’s North Slope. This area is near other major oil projects and important energy regions. The Horseshoe Unit may become valuable in the future if companies decide the land can be developed.