Magnum Hunter Resources Corp. Wednesday said it plans to test for the first time the potential of the deep Pearsall Shale formation in South Texas after agreeing to pay $2.35 million to buy an additional 1,885 net mineral acres in Atascosa County.
The deal brings the company’s gross acreage in Atascosa County to 7,278 and net acreage to 5,212. The company’s existing acreage in the county to date has been used to drill Eagle Ford Shale wells, a spokesman noted. The Pearsall formation is about 2,500 feet beneath the Eagle Ford Shale.
“The company is actively reviewing additional acreage expansion opportunities throughout the South Texas region where we continue to successfully develop our leasehold position in the Eagle Ford,” said Magnum Hunter CEO Gary C. Evans. And “we have been monitoring the Pearsall Shale developments for almost a year now. We are excited about the prospects for future development of the evolving Pearsall Shale play and anticipate additional expansion of our existing leasehold position in this region.”
The new acquisition gives Magnum a total of close to 40 total net drilling locations in the Pearsall formation. About 10 additional net drilling locations were added through the acquisition in the Pearsall, and 10-13 net drilling locations were added in the Eagle Ford.
The first well was spud on the acquired acreage on Aug. 4, and plans are to drill vertically to run logs and cores for a full formation evaluation on the Pearsall Shale. The well then would be drilled horizontally and completed in the Eagle Ford.
The Atascosa core area would be an ideal geologic setting to develop the Pearsall formation, which is within the “wet gas to rich condensate window,” the producer noted. The area is bounded by the Charlotte fault trend eight miles to the north and the Karnes fault trend to the south.
In June Cabot Oil & Gas Corp. struck an agreement with a U.S. unit of Osaka Gas Co. Ltd. for the sale of a 35% nonoperated working interest in 50,000 net acres leased by the company in Atascosa, Frio, La Salle and Zavala counties in Texas for $250 million (see Shale Daily, June 25).
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