Parsley Energy Inc. has stated that it has entered into an agreement to acquire certain undeveloped acreage and producing oil and gas properties in Glasscock County, Texas, as well as associated mineral and overriding royalty interests, for an aggregate purchase price of US$400 million in cash, subject to customary closing conditions. Parsley intends to finance this acquisition through debt and equity issuances announced concurrently with the acquisition.
- 11 672 gross leasehold acres near existing Parsley leasehold in Glasscock County, Texas.
- Mineral and overriding royalty interests boost net revenue interest by approximately 5% on average.
- Estimated current net production of approximately 270 Boe per day from 67 gross (60 net) vertical wells.
- 240 gross (215 net) horizontal drilling locations in the Lower Spraberry, Wolfcamp A, and Wolfcamp B formations, based on 660' between-well spacing, with an estimated average lateral length of approximately 7500'.
- Additional horizontal drilling locations in the Middle Spraberry, Wolfcamp C, and Cline formations.
- High average working interest of approximately 92% on identified drilling locations 99% held by production.
- Pre-existing facilities and infrastructure, including five saltwater disposal wells, facilitate ongoing development.
- Scheduled to close on or before October, subject to the satisfaction of customary closing conditions.
Initial Glasscock County horizontal well
Parsley's first producing horizontal well on the Glasscock County acreage the Company has shown encouraging results to date. The Dwight Gooden 6-7-01AH registered a strong peak 30-day initial production rate of 1161 boe/d. Normalised to 7000 lateral ft, the well is outperforming the Company's 1 million boe EUR type curve for Midland Basin Wolfcamp A/B wells by 10% after almost 90 days of production, generating 82% oil during that timeframe.
"The pending acquisition of leasehold and associated assets establishes Glasscock County as another key development area for Parsley Energy," stated Bryan Sheffield, CEO of Parsley Energy. "Offset well performance and initial results on our first horizontal well in the area suggest that the properties to be acquired may compete with the best of our existing horizontal drilling inventory, and the acquisition of associated royalty interests boosts the return profile of these properties. We continue to build a high-quality acreage footprint consisting of favorably distributed development areas that can accommodate significant rig count additions, and we believe this acquisition represents an important step toward a large-scale, basin-wide development programme that can generate sustainably strong production and cash flow growth."
Edited from press release by Angharad Lock
Read the article online at: https://www.oilfieldtechnology.com/drilling-and-production/16082016/parsley-energy-announces-midland-basin-acquisition-2936/