Tulsa-based Triple Crown Energy LLC said Wednesday it has completed two joint ventures (JV) for acreage in Kansas with U.S. Energy Development Corp. and Millennial Energy Partners LLC, with plans to drill up to 24 wells over the next year.
The initial project involves vertical drilling in an established oilfield, said Chase Williams, business development head of the privately-owned Triple Crown. The former Chesapeake Energy Corp. executive told NGI's Shale Daily the JV activity will cover parts of Triple Crown's 40,000 net acres in western Kansas.
The JV with U.S. Energy involves the sale of a 50% working interest (WI) on 2,500 net acres in Hodgeman and Ness counties. The Millennial JV includes a 25% WI in 10,000 net acres in Hodgeman, Ness and Gove counties, including all of the U.S. Energy acreage.
The JV partners would be included in all of the first 24 wells, which should be completed in the next six months, said Williams. "We anticipate that Millennial and U.S. Energy will participate in all the wells along side us. The first 18 wells we'll be drilling are direct offsets or core shots to existing quality vertical production."
In Ness County, there have been 1,400 producing wells that have averaged 96,000 bbl/well of production, Williams noted. "This is an old, established oilfield, and we're just going in in a standard basis; it isn't sexy, but it makes money," he said. "The average well costs are between $500,000-600,000/well."
The plan is to have two or three offsets from each of the 24 wells drilled. "We'll be drilling all of those as a second phase, in addition to acquiring new acreage; we'll be drilling much more than 24 wells up there."
Buffalo, NY-based U.S. Energy CEO Jordan Jayson said the JV is consistent with his company's strategy of "rapid, prudent expansion across a variety of plays," and the team approach should bring "enhanced drilling results." Millennial's Philip Gayle, executive vice president, echoed those comments, noting his Houston-based firm seeks out strategic partnerships.
Triple Crown has existing production in parts of Oklahoma outside of the South Central Oklahoma Oil Province, or SCOOP (see Shale Daily, Sept. 18). It also has mineral buying business centers in Ohio and West Virginia.