Torchlight Enters Option Agreement to Sell Hazel Project

(NASDAQ:) ("Torchlight" or the "Company"), today announced the signing of an option agreement to sell the Hazel Project to a group of private investors. The Company has agreed to sell the acreage at $1,300 an acre after an option period. The investors must drill and complete the Flying B Ranch #4 well in the project to earn the option and then, after a period of evaluation, they have the option to acquire the remaining acreage for the amount stated. Torchlight controls 9,600 net acres in the play and if the option is exercised and the acreage sold, the purchase price would bring in approximately $12.4 million dollars. If the option is exercised, the funds would be transferred no later than March 31, 2021. If the investors do not exercise, their recourse is the revenue associated with the production from the Flying B #4 only, until such time as they recoup their funds, and then the wellbore and production is turned back over to Torchlight. The well will be drilled and completed horizontally in the Wolfcamp A formation with a proposed lateral distance of 7,500 feet.