STW Resources Receives Approval for Texas Water Project

MIDLAND, Texas (Dec. 16, 2015) – STW Resources Holding Corp., a provider of pipeline services, water reclamation and processing management services including water desalination, has received approval from the Middle Pecos Water District for drilling, production and transportation of the water on STW Water’s MRK lease in Pecos County. Previously, STW Water applied for a consolidated drilling and production permit from the San Andrés formation to be utilized within the county and exported out of Pecos County to surrounding areas in need of water. The water district approved the permit in a unanimous decision with STW meeting the following conditions:

• 5000 acre-feet or 4,464,000 gallons per day for industrial use (oil and gas) with the ability to export the water out of the county
• The drilling of one monitor well on the company’s leased property
• Approval for three new wells to be drilled and spread out on the two properties near Imperial, Texas, on land STW has under lease
• The ability to rehab the existing two wells (MRK East & MRK West) if STW is unable to rehab the wells, whereupon the company will plug the wells with the ability to request two replacement wells from the general manager of the water district
• The submission of a revised and updated Hydrogeological study to the water district from the information obtained by drilling and testing these wells

The company also has the ability to submit a request to the water district for a larger permit once it is determined by the hydrogeologist that the formation can withstand an increase in yield without any negative effects. Additionally, with several prospective buyers already in place, STW can begin selling water immediately. The company anticipates water sales in the first quarter of 2016, as it has already received a letter of intent from a local customer to purchase water. “This is a milestone achievement for STW, one that we have been working towards for quite some time and are thrilled it has come to fruition,” said Alan Murphy, CEO of STW Resources Holding Corp. “We consider this to be a pivotal moment in establishing STW’s West Texas Water Project as one that will provide processed and/or raw alternative water from multiple sources direct to the end user. With the production and transportation permits approved, the company can now market the water more effectively and begin to execute sales agreements with local buyers.”