Exhibit 99.01
IMMEDIATE RELEASE For Additional Information Contact:
June 20, 2002 Susan Trimboli
Mid-Power Service Corporation
3800 Howard Hughes Parkway, Suite 860A
Las Vegas, NV 84109
(702) 319-7153 Fax (702) 214-3865
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Mid-Power Service Corporation Acquires
Clear Creek Property in Utah
Las Vegas, NV, June 20, 2002 -- Mid-Power Service Corporation (OTCBB: MPSC)
announced the acquisition of oil and gas rights located on approximately 17,000
gross acres comprising the Clear Creek Unit in Utah's Carbon and Emery Counties.
The Clear Creek field was originally discovered and developed during the
mid-1950s. One of the 16 wells initially completed remains in production. To
date, approximately 136 billion cubic feet of gas have been produced from the
field. Mid-Power is evaluating the extensive engineering, geological and
geophysical data available as a guide toward seeking to expand significantly
production in the Clear Creek field.
The property was acquired through the acquisition of Red Star, Inc., a
privately-held company that owns and operates the Clear Creek Unit. In the
acquisition, Mid-Power paid $5,500,000 in cash, agreed to pay $10,000,000 in
seven months, and issued 17.1 million shares of Mid-Power common stock to the
sole stockholder of Red Star, Edward Mike Davis, who as a result now owns
approximately 70% of the issued and outstanding stock of Mid-Power.
Immediately preceding the acquisition, Mid-Power entered into a loan agreement
with SCRS Investors, LLC, under which Mid-Power may borrow up to $25,000,000 to
complete the acquisition and to engage in initial exploration and development
activities on the Clear Creek field. The loan will be secured by the assets
acquired through the acquisition of Red Star. The loan is repayable over 10
years, commencing on December 31, 2003, and is convertible into Mid-Power common
stock at $1.50 per share, subject to certain limitations. James W. Scott,
Mid-Power's President and a director, is a principal member of SCRS, and Mark T.
Davis, Mid-Power's General Counsel, is a member of SCRS.
The Board of Directors of Mid-Power believes that the combination of Red Star's
assets with Mid-Power's financial resources and access to capital will result in
more profitable and better-utilized assets. This acquisition represents a
significant step in Mid-Power's implementation of its business plan. In addition
to the exploration and development of the Clear Creek Unit, Mid-Power intends to
continue its focus on the exploration, development and acquisition of oil and
natural gas opportunities.
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This release contains forward-looking statements. Forward-looking statements are
not guarantees of future exploration or development results; the accuracy,
completeness or reliability of engineering, geological or geophysical data on
which exploration or development activities may be based; the actual presence or
recoverability of estimated reserves; the ability to establish reserves equal to
the potential of exploration targets; production amounts or revenues;
exploration or development costs or schedules; or similar matters.
Forward-looking statements are subject to risks and uncertainties outside
Mid-Power Service Corporation's control. Actual events or results may differ
materially from the forward-looking statements. For a discussion of additional
contingencies and uncertainties to which information respecting future events is
subject, see Mid-Power Service Corporation's 2001 annual report on Form 10-K and
other SEC reports.