Cano Petroleum Enters $8 Million Agreement to Purchase Square One Energy; Cano to Implement Enhanced Oil Recovery Methods on Newly Acquired Field

FORT WORTH, Texas, March 8 -- Cano Petroleum Inc. ( OTC = CAOP ) (BULLETIN BOARD: CAOP) has entered into an $8 million contract to purchase Square One Energy, a central Texas-based oil and gas operating company, as part of the company's strategy to acquire oil reserves and significantly increase production through enhanced recovery technology.

Square One Energy's assets include a 100% working interest in 10,300 acres of mature oil fields in Erath, Comanche and Eastland counties, with current net production of approximately 70 barrels of oil per day from 34 wells at 2,600-foot depth in the Duke sand.

Cano's third-party engineers, using SEC price decks, have concluded that there are 1,065,000 barrels of proved oil reserves. Cano estimates the field contains more than 40 million barrels of probable oil reserves. The field had approximately 100 million barrels of original oil in place and, to date, has produced approximately 17 million barrels of oil in primary production.

Cano plans to apply its expertise in enhanced oil recovery methods, including waterflooding, which has not been used on the field, and evaluate whether an alkaline-surfactant-polymer (ASP) process can enhance oil ... // 71% Remaining