California-based Trio Petroleum Corp. secured an option from Heavy Sweet Oil LLC to acquire 20% interest in a low-sulfur, heavy-oil Asphalt Ridge development project in Uinta County, Utah, the company announced Jan. 5 in a press release.

Trio Petroleum secured the option to participate in Heavy Sweet’s initial 960-acre drilling and production program, which is slated to begin first quarter 2024, according to the company’s filing with the Securities and Exchange Commission (SEC).

The Asphalt Ridge option involves a nine-month term ending Aug. 10 with a purchase price of $2 million, which may be paid in tranches provided and the first tranche is paid out during the option period. On Dec. 29,  the company paid the $200,000 advance of the total purchase price and attained a 2% interest in the Asphalt Ridge Leases.

Heavy Sweet Oil also agreed to fund a maximum of $5 million for the initial development program, with additional participating parties splitting costs thereafter based on ownership interests.

Heavy Sweet Oil also entered into a leasehold acquisition and development option agreement with Lafayette Energy Corp. to acquire up to 30% of the Asphalt Ridge Leases. In Trio Petroleum and Heavy Sweet Oil’s option agreement, provided Lafayette Energy does not exercise its option rights, Trio Petroleum has the right to acquire up to all 30% of the Lafayette Energy option.

“It is excellent to be able to diversify our exciting portfolio of California opportunities with such a high-potential asset in Utah, especially one that will not require a lot of additional capital expenditures according to the operator’s development plan,” Michael L Peterson, Trio Petroleum’s CEO, said in the press release. “Development is commencing now and, with success, the Utah asset may be cash flowing in mid-2024. We now have two major assets in our portfolio, the South Salinas Project in California and the Asphalt Ridge Project in Utah.”

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