Company: CRCE
Filing Date: 2025-05-14
Form Type: 10-Q
Source: 0001096906-25-000799
Chunk: 4

Company: Circle Energy, Inc./NV
Filing Date: 2025-05-14
Form: 10-Q
Item: Part I, Item 2
Chunk 4
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, and in March 2022, we completed a non-public offering of our common stock in which we raised gross proceeds of $264,000, all of which we intend to be used for general operating expenses, for our current project, and to search for additional suitable oil and gas properties or projects.

C. W. Logsdon Lease

Under the terms of a Farmout Agreement and Conditional Lease Assignment dated May 16, 2022, we have acquired a 75% working interest, and 55.5% net revenue interest, in the C. W. Logsdon Lease, an 80-acre tract located in Andrews County, Texas.  We acquired the interest from Aspen Energy Partners, LTD. (“Aspen”), a Florida limited partnership which holds the remaining 25% working interest.  Under the lease agreement, we are required to drill at least two wells, one on each 40-acre farmout tract, within three years or the rights under the lease to any undrilled tract or tracts will automatically revert to Aspen.  

There are currently two plugged but no producing wells on the lease.  These two wells were drilled on 40-acre spacing, produced from the Clear Fork and were economical.  There are additional wells on surrounding acreage that have produced marketable quantities of oil and gas.

The initial intent is to drill two new Clear Fork wells based on 20-acre spacing.  Management believes there is potential for further downspacing to 10-acre spacing, depending on oil and gas prices, development cost and completion results of the 20-acre development.  Management also believes there is potential for San Andres development with possible 10-acre spacing, again depending on oil and gas prices, development costs and completion results.

We have also entered into a joint venture agreement with Aspen to mutually develop an area of mutual interest near the current lease. This area of mutual interest consists of approximately 880 acres including and adjoining the acquired 

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acreage.  If we are successful in acquiring additional acreage, we would jointly own mineral rights in the same percentage of ownership with Aspen as the current lease (75% Circle, 25% Aspen).  The parties intend that the joint venture would use AAPL 610-19819 or AAPL 610-2015 or similar operating agreement to structure the joint venture.  The liabilities of the parties would be severed and not joint, and each party would be responsible only for its share of the costs and liabilities