Formcap Corp. announced that geological and geophysical (G&G) due diligence on the acquisition of 1500 acres of prospective oil leases (the Leases) in Cowley County, Kansas is completed. The G&G work has identified four exploration drilling locations on the Leases.

FormCap expects that drilling will commence on the Leases in Q-1 2014. Furthermore FormCap has expanded the scope of its proposed lease purchase program in Cowley County, Kansas by an additional 900 acres for a total of up to 2,400 acres of prospective oil and gas exploration Leases. In addition to the four drilling locations, FormCap expects to acquire a seismic program in early 2014 in concert with other explorers in the area to further delineate exploration prospects on the Leases.

There are four significant oil and gas fields in the area of the Leases, the Atlanta; Burden; Eastman and Combs Fields. These fields collectively have cumulative production of over 9 million barrels of oil. FormCap will pay Kerr and Keta $200.00 per acre for up to 2400 acres of Leases, at total cost not to exceed four hundred $480,000 (the Purchase Price) unless agreed otherwise by the Company.

FormCap will own 100% of the Leases (80% net revenue to FormCap; 20% freehold royalty), and will be operator. FormCap will have the option to purchase additional leases in Cowley County from Kerr and Keta under an Area of Mutual Interest (AMI), the terms of which are set forth in the Agreement. FormCap is required to drill one well in each of the first two years of the Lease term to maintain its interest in the Leases.

FormCap will also have the option to participate in the drilling of up to six exploration or development wells on lands currently owned by Keta and Kerr under terms set forth in the Agreement.