By OGJ editors
HOUSTON, Mar. 26 -- Venoco Inc. recently signed two separate agreements with two undisclosed companies to acquire properties in California and Texas for a combined net cost of $106 million.
In one agreement, Veneco will acquire West Montalvo field in Ventura County, Calif. The field, discovered in 1951, has 243 million bbl of oil in place, with only 10% recovered. It is within 5 miles of Veneco's Hastings field.
Venoco Pres. Bill Schneider said the field has seen limited capital in the last decade. In addition to the fee leasehold, the field includes a largely undeveloped offshore portion under lease from the State of California that is easily reachable from onshore locations.
The other agreement covers the acquisition of several Texas Gulf Coast fields, including Manvel field in Brazoria County, which is similar to Veneco's Hastings field.
Since acquiring Hastings last year, Schneider said, Veneco has completed over 100 workovers in the field, increased production by more than 35%, and added 3 MMboe to proved reserves. "We see the same type of potential in the Manvel field," he added, "particularly since both produce from Frio sands and are very similar geologically."
Veneco initially plans to return idle wells to production, enhance the lift systems, and upgrade the facilities. This work is expected to yield results similar to that in Hastings field of increased daily production and proved reserves.
Schneider said studies may prove Manvel to be a good candidate for CO2 flooding.
The properties being acquired have an estimated combined total proved reserves of 9.7 million boe and proved plus unproved conventional reserves of 14.7 MMboe as of Dec. 31, 2006. Conventional reserves do not include reserves from tertiary recovery methods. There are a total of about 75 wells on the properties, and the two acquisitions should add over 500 boe/d to Venoco's average net production this year.