Jericho Oil Corp., Vancouver, BC, has entered into a farm-in agreement through its Oklahoma STACK joint venture with a private operator to drill 2-5 horizontal wells in Major County near the company’s core STACK operating area.
After drilling and completing two standard-lateral, 4,500-ft horizontal wells targeting the Osage formation, the STACK JV will earn a 50% interest in 6,000 net leasehold acres. Additional well commitments by the STACK JV will increase the combine’s drilling terms on the leasehold acreage. Combined with the STACK JV’s existing acreage, its consolidated core position will total 11,600 net acres.
The STACK JV will participate in the drilling of the first scheduled Osage well and pay its working interest share of costs. The second Osage well is expected to be drilled in this year’s first half.
As part of the deal the STACK JV partner increased its capital commitment to finance a portion of the farm-in agreement. Pro-forma for the commitment Jericho will hold 26.5% interest in the STACK JV.