Other Briefs

June 10, 2014

Rose enters Mancos, Cane Creek shales

Rose Petroleum has signed a $2 million farm-in agreement that is set to bring the company acreage in the Uinta and Paradox basins in eastern Utah prospective to the Mancos and Cane Creek shales.

Subsidiary Rose Petroleum (Utah) LLC will be able to acquire 75% operated interest in 195,000 acres (146,250 net acres)—including a 75% working interest in one shut-in well—in Grand and Emery Counties, Utah.

In addition to the $2 million price tag, Rose also agreed to drill three wells targeting the Mancos shale and one well targeting the Cane Creek shale.

Total carry obligations for the initial wells are expected to total $9.5 million in the Mancos and $7.5 million in the Cane Creek. No time frame has been set for drilling of the wells.

Once carry obligations are met, Rose said all usual costs and expenses will be split by Rose and Standard in proportion with their working interest in the properties, with Rose paying 75% and Standard Oil paying 25%.

The area surrounding the acquired leasehold is home to a number of producing wells, including several vertical Mancos shale wells with individual cumulative production of up to 120,000 bbl/well. Twelve miles north of Rose's Utah leases are vertical wells targeting the Cane Creek shale in and around Cane Creek field. Rose said some of these wells, which are operated by Fidelity Exploration and Production Co., have produced more than 1 million bbl of oil.

Noble tests frontier oil play in Nevada

Noble Energy Corp. is testing a frontier oil play in northeastern Nevada and plans to complete by midyear the first of two vertical exploration wells drilled in its project area.

"Drilling results, thus far, have confirmed the existence of a thick Elko reservoir section, hydrocarbon saturation, and thermal maturity," Noble Chief Executive Officer Charles Davidson told analysts in February.

Chief Operating Officer David Stover added, "The next step out there is to complete a well and see what we can flow."

The Mary's River Oil and Gas Exploration Project spans 39,450 acres in the Tabor Flats area, roughly 4 mi northeast of the town of Wells, in Elko County, Nev.

The US Bureau of Land Management (BLM) in April 2014 wrapped up a public comment period for the project, about half of which is located on public lands.

Regulatory filings show Noble plans to drill and complete up to 20 wells targeting the Humboldt, Indian Well, and Elko formations. The exploratory project could last more than 2 years, and wells are slated to reach true vertical depths of 7,000-16,000 ft.

Targets for possible horizontal laterals will be determined by the results of the vertical/directional wells. BLM said the range in depths is variable due to the multiple formations under investigation, and the basin shape, subsurface dip, and faults.

EnerVest, FourPoint grow in Granite Wash

EnerVest Ltd. and FourPoint Energy LLC are expanding their position in the US Midcontinent, agreeing to purchase producing properties in the Granite Wash formation in Oklahoma and Texas for $275 million.

The joint venture partners are set to acquire 47,000 net acres with estimated net production of 31.9 MMcfe/d, 43% liquids, from 642 wells.

The acreage is in Hansford, Hemphill, Ochiltree, Roberts, and Wheeler counties, Tex., and Beckham, Custer, Dewey, Ellis, Roger Mills, and Washita counties, Okla.

The purchase will provide EnerVest and FourPoint additional development drilling opportunities in an area where they already hold a sizable asset position.

"This is another one of hopefully many acquisitions with our JV partner, FourPoint," said John Walker, chief executive officer of EnerVest.

"Once we have closed this acquisition we will have spent more than $1 billion acquiring properties in the Midcontinent region within the last year. We look forward to continued growth in the area," Walker said.

The deal is expected to close by Jun. 30. EnerVest and FourPoint are both backed by private equity.