By OGJ editors
HOUSTON, Dec. 11 -- Cantex Energy Corp., San Antonio, in partnership with Big Canyon Energy, signed an exploration and development agreement with Slawson Exploration Inc., Wichita, covering the Big Canyon prospect in Terrell County, Tex.
Slawson Exploration will earn a 45% working interest in operating the project, which covers an initial 17,151 acres of prospective natural gas lease held by Big Canyon Energy and 7,680 acres of lease option. Beyond the lease and option coverage, the total area of mutual interest between the parties totals 89,929 acres.
Cantex Energy has the right to participate throughout the area of mutual interest based on Cantex's payment of future pro rata drilling and any further lease-option costs. Big Canyon Energy et al. retains a 39.375% working interest, with Cantex Energy holding the remaining 15.625% working interest.
The acreage is in the West Texas Overthrust area of the Val Verde basin.
Cantex Energy earned the right to participate in the Big Canyon prospect by funding and deploying a seismic survey in 2004-05. Interpretation suggests the presence of at least five large imbricate fault closures that cover 10 sq miles or more, highly similar to the character of Pinon field in Pecos County 40 miles northwest of and on trend with the prospect (see cross sections, OGJ, Nov. 24, 2008, pp. 34-35).
The Big Canyon prospect is further set up by the presence of potentially commercial quantities of gas as close as 5 miles from the leasehold, and in the AMI, a discovery well drilled in 2004 by SandRidge Energy Inc.'s predecessor Riata Energy Inc., that flowed almost 2 MMcfd on a 16/64-in. choke. This "show" is believed to have occurred in the objective thrusted Pinon field-type Caballos reservoirs.
Pending working interest decisions and actions, the companies expect to participate in exploratory wells on two of the five imbricate closures in 2009.
