Denver-based independent St. Mary Land & Exploration Co. has completed a $29.5 million natural gas-rich acquisition in South Texas, and with it, has realigned its operations along the Gulf Coast.
The acquired assets target the Olmos shallow gas formation and are located in the Catarina Field in Webb and Dimmit counties. Estimated net proved reserves are 14 Bcfe, 99% weighted to gas, and 65% of which are proved developed. Current net production is 2.9 MMcfe/d, which is 98% gas. The assets, which are 100% operated, are expected to contribute 600 MMcfe of production this year.
CEO Tony Best said "onshore South Texas is an area that we have been looking to enter for a number of years. We are entering the play at an attractive cost and believe that this acquisition gives us a foundation for growth in the region."
St. Mary also realigned its Greater Gulf Coast region, which had overseen the company's Gulf Coast and Permian Basin operations, into two separately managed business units. The company's Permian assets will be managed from the Midland, TX, office, which was opened in February. The remaining onshore Texas, Gulf Coast and Gulf of Mexico assets will be managed by the Houston office.
Lehman "Newt" Newton III was appointed regional manager of the Permian operations, and the company is in the process of looking for a new regional manager for its Gulf Coast business.
"With operated activity ramping up in the Permian Basin and the addition of these South Texas assets in the Gulf Coast region, we felt this was the right time to split the region into two separate operating areas," said Best.
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