Junior independent Lexington Resources Inc., which is focused on natural gas exploration in the Arkoma Basin, said Wednesday it more than doubled its drillable land holdings in Oklahoma with the acquisition of 4,600 acres of coalbed methane-targeted natural gas leases. Lexington paid $125,000 toward the farm-out lease purchase of $600,000. Acreage included in the acquisition extends over an area of mutual interest of approximately 24,320 acres. The new leases encompass rights to all possible producing zones to the base of the Hartshorne Coal Formation at estimated depths of approximately 3,000 feet and include a 79.25% net revenue interest and a 100% working interest. With the latest purchase, the Las Vegas-based producer’s land position now totals drillable acreage of almost 9,000 acres.
Basin
Articles from Basin
Most of West Up; Mild Temps Extend Eastern Fall-Off
Most eastern points were joined by Permian Basin/Waha quotes in continuing to move lower Monday, but non-Permian/Waha markets in the West rallied from what had tended to be the biggest weekend price drops.
Transportation Notes
Questar reported experiencing a mechanical failure of unit #5 at its Clay Basin storage facility Sunday evening, and as a result, injection capacity was reduced by 20,000 Dth/d to 350,000 Dth/d for Tuesday’s gas day. The restriction will continue until repairs are completed.
Pemex: Lewis Energy Bids $340M on Seventh Burgos Block
Lewis Energy Group, headquartered in San Antonio, on Wednesday bid to produce natural gas in Mexico’s Burgos Basin for Petroleos Mexicanos (Pemex). Lewis, the only bidder, estimated it would invest about $340 million over 20 years to produce 40 MMcf/d.
Vintage Deal to Acquire El Paso Uinta Properties Collapses
Negotiations to sell Vintage Petroleum Inc. some of El Paso Corp.’s producing properties in the Uinta Basin of Utah have ended after the two companies failed to reach an agreement before the scheduled closing date. The $52.5 million acquisition, announced in November, would have given Vintage an 80% operated working interest in about 200,000 net acres (see Daily GPI, Nov. 12, 2003).
Keystone Begins Open Season for 2 Bcf Available Capacity
Unocal Keystone Gas Storage LLC has begun a non-binding open season through Nov. 7 for 2 Bcf of available capacity at its Keystone gas storage facility located in the Permian Basin.
Keystone Begins Open Season for 2 Bcf Available Capacity
Unocal Keystone Gas Storage LLC has begun a non-binding open season through Nov. 7 for 2 Bcf of available capacity at its Keystone gas storage facility located in the Permian Basin.
Ziff Finds Western Canada Operating Costs Continue to Rise
A study of 176 oil and gas fields in the prolific energy basin of Western Canada has found that operating costs continue to rise. Ziff Energy Group analysts report that in 2002, the average cost to operate natural gas fields was up 3% to C$0.70/Mcfe, while average oil operating costs increased 6% to C$6.85/boe.
Ziff Finds Western Canada Operating Costs Continue to Rise
A study of 176 oil and gas fields in the prolific energy basin of Western Canada has found that operating costs continue to rise. Ziff Energy Group analysts report that in 2002, the average cost to operate natural gas fields was up 3% to C$0.70/Mcfe, while average oil operating costs increased 6% to C$6.85/boe.
Industry Briefs
Berry Petroleum Co. has completed its $48.6 million purchase of Uinta Basin properties from Williams Production RMT Co. The properties, located in the Brundage Canyon in northeastern Utah, currently are producing 1,800 net boe/d. Berry estimates the 43,500 acres have proved reserves of 8.6 million boe, comprised of 75% light oil and 25% natural gas. The company said it had identified more than 50 proved undeveloped locations and 25 behind pipe recompletions within the productive area of the field. The Bakersfield, CA-based independent also announced that Logan Magruder has joined the company as vice president of the Rocky Mountain and Mid-Continent Region. Magruder held similar positions with Calpine Corp. and Barrett Resources, and has served as a consultant for Berry since Feb. 2003.
