SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 8-K
CURRENT REPORT UNDER SECTION 13 OR 15(D) OF
THE SECURITIES EXCHANGE ACT OF 1934
Date of Report (date of earliest event reported): May 18, 1998
Commission File Number: 0-14096
FORELAND CORPORATION
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(Exact Name of Registrant as Specified in its Charter)
NEVADA 87-0422812
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(State or other jurisdiction of (IRS Employer
incorporation or organization) Identification No.)
12596 W. BAYAUD AVENUE
SUITE 300, LAKEWOOD, COLORADO 80228
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(Address of Principal Executive (Zip Code)
Offices)
Registrant's Telephone Number, including Area Code:
(303) 988-3122
N/A
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(Former name, former address, and formal fiscal year, if changed since
last report)
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ITEM 5. OTHER EVENTS
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Foreland Corporation announced on May 18, 1998, that the Company will acquire
the Nevada refining and related transportation assets of Petro Source
Corporation of Houston, Texas, for $5 million, 100,000 common shares of
Foreland, and approximately $1.0 million for current inventory. The acquisition
will be effective as of June 1st with closing scheduled on or before June 15,
1998.
Funding for the transaction is provided by the Energy Income Fund, Inc. (EIF) of
Longmeadow, Massachusetts. Foreland renegotiated the terms of its existing
$16.9 million debt facility which included a $2.0 million equity placement of
convertible preferred stock at $6.00 per share and 500,000 warrants exercisable
at $9.00 per share.
The refineries are located in Railroad Valley and Tonopah, Nevada, and have a
combined capacity of 12,000 barrels of oil per day; current throughput is 2,400
barrels per day. Petrosource Transportation operates twenty-four tractor
trailer rigs gathering crude and delivering refined products in a five state
area. The Petro Source Refinery and Transportation management and employees
will each be offered positions with Foreland.
Foreland management believes that the acquisition of these downstream assets
will transform Foreland into an integrated E&P company resulting in multiple
profit centers from well head to retail markets and that integration is a key
factor in maximizing the economics of exploration and development through
stabilizing long term oil prices.
Foreland's production from its Eagle Springs and Ghost Ranch field will now be
processed through Foreland Refining Corporation, a wholly owned subsidiary of
Foreland Corporation. Production testing continues at Foreland's Sand Dune
discovery which could add significant daily throughput and revenues.
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SIGNATURES
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Pursuant to the requirements of the Securities Exchange Act of 1934, as
amended, the Registrant has duly caused this report to be signed on its behalf
by the undersigned hereunto duly authorized.
Dated: May 21, 1998
FORELAND CORPORATION
By /s/ N. Thomas Steele, President
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