Blast Adds New Director and Updates Operational and Litigation Matters
June 03 2008 - 7:30AM
PR Newswire (US)
HOUSTON, June 3 /PRNewswire-FirstCall/ -- Blast Energy Services
(OTC:BESV) (BULLETIN BOARD: BESV) today announced the addition of
Michael L. Peterson to the Blast Energy Services board of
directors. Mr. Peterson brings to the board a 23-year experience in
the investment management and securities industry. "We are
delighted Michael Peterson has agreed to join the Blast board of
directors," said Pat Herbert, Chairman of Blast Energy Services.
"His proven financial and investment market expertise will
supplement our talented group of directors and help define new
growth strategies following our successful emergence from Chapter
11 Bankruptcy in February 2008." Mr. Peterson has enjoyed a
successful career in the securities industry in various capacities,
including the last four years as a private investor and venture
capitalist. He is currently founder and managing partner of
California-based, Pascal Management. In 2005, he co-founded and
became a managing partner of American International Partners, a
venture investment fund based in Salt Lake City. Prior to that he
served for four years as a First Vice President at Merrill Lynch
where he helped establish a new private client services division to
work exclusively with high net worth investors. For a majority of
his career, he was employed by Goldman Sachs & Co. as a Vice
President with the responsibility for a team of professionals that
advised and managed over $7 billion in assets. Mr. Peterson
received his MBA at the Marriott School of Management and a BS from
Brigham Young University. Down-hole Solutions Blast has completed
an evaluation of its down-hole lateral drilling process with new
partner Reliance Oil and Gas, Inc., whose personnel have over 40
years of experience in drilling, exploration and production
operations. As a result, Reliance plans to use a deflection shoe of
their own design, use more rigid tubing for penetration into the
formation, and a different jetting nozzle design. To this end,
Reliance has built the new deflection shoe to laterally deflect
stainless steel tubing into the formation and to circulate fluid
through the shoe while jetting. They are also upgrading certain
equipment on the jetting rig so that the improved lateral drilling
process can be used on wells operated by Reliance in Central Texas
this summer. Reliance's personnel have prior experience
specifically applying these down-hole jetting processes, which we
believe will substantially improve the commercial viability of the
Blast lateral jetting process and allow us to begin generating
revenues this summer. Satellite Services Meanwhile, Blast has been
working with a group of ex-Cisco engineers with substantial
experience in communications and sensor networks to develop a
unique remote monitoring system for oil and gas applications. Since
September 2007, these engineers have carried out extensive testing
with the Department of Defense on a process to improve the
monitoring and control of chemical, biological, radioactive,
nuclear and explosive sensor networks. Blast believes that the
software they have developed is ideally suited to monitoring and
controlling temperature, pressure, flow, corrosion and intrusion
sensors in the energy sector. A server unit has been built to
provide monitoring and control of multiple sensors using standard
and proprietary radio protocol controlled applications that are
currently being used in pipeline and oil field operations. Blast
expects to have its' demonstration unit completed by the end of
June. Blast has been discussing this new product with several
energy service and systems integration companies over the last six
months and is currently scheduling demonstration meetings with them
in Houston, Texas. Blast believes there is a substantial
opportunity in the energy industry to consolidate the remote
monitoring and control of sensor networks and to provide immediate
notification to key personnel by interfacing seamlessly with a
customer's existing communication network. We expect our new remote
server application will allow us to further expand the growth
opportunities of our existing satellite services business. Customer
Litigation On April 7, 2008, Blast signed a $6.4 million settlement
agreement with Hallwood Petroleum, LLC and Hallwood Energy, LP that
is contingent upon them raising capital through a major financing.
Under the terms of this agreement, Hallwood will pay to us $2.0
million in cash and issue $2.75 million in equity from the pending
major financing and Hallwood agreed to irrevocably forgive
approximately $1.65 million in payment obligations. In return, we
have agreed to suspend legal proceedings against Hallwood. If the
settlement is not completely funded by September 30, 2008, legal
proceedings will resume. The damage model in this case involves
termination damages for two separate rig contracts. In the case
pending against Quicksilver Resources, Inc., the matter has been
successfully transferred from the bankruptcy court to the US
District Court for the Southern District of Texas. The trial date
has remained unchanged and is scheduled for September 15, 2008.
Blast counsel continues to prepare for trial and gather evidence in
support of our claim through depositions and document production.
The damage model for this case involves termination damages for
three separate rig contracts, which included liquidated damage
provisions of approximately $10 million each. Safe Harbor Statement
This press release contains forward-looking statements within the
meaning of the Private Securities Litigation Reform Act of 1995
(the "Act"). In particular, when used in the preceding discussion,
the words "believes," "expects," "intends," "anticipates," or
"may," and similar conditional expressions are intended to identify
forward-looking statements within the meaning of the Act, and are
subject to the safe harbor created by the Act. Additionally, any
statements made in this news release other than those of historical
fact, about an action, event or development, are forward looking
statements. Forward looking statements involve known and unknown
risks and uncertainties, which may cause the Company's actual
results in future periods to be materially different from any
future performance that may be suggested in this release. Such
factors may include risk factors including but not limited to: the
ability to raise necessary capital to fund growth, adequate
liquidity to manage operations and debt obligations, the
introduction of new services, commercial acceptance and viability
of new services, fluctuations in customer demand and commitments,
pricing and competition, reliance upon lenders, contractors and
vendors, the ability of Blast Energy Services' customers to pay for
our services, together with such other risk factors as may be
included in the Company's periodic filings on Form 10-K, 10-Q, and
other current reports. Blast takes no obligation to update or
correct forward-looking statements, and also takes no obligation to
update or correct information prepared by third parties that are
not paid for by the Company. DATASOURCE: Blast Energy Services
CONTACT: John MacDonald, +1-281-453-2888, or +1-713-725-9244, , of
Blast Energy Services, Inc. Web site:
http://www.blastenergyservices.com/
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