TXO Partners has announced that the Mancos Shale play in the San Juan Basin of New Mexico and Colorado has a nearly 3 trillion ft3e potential for natural gas.
“TXO has built a portfolio of oil and gas rich assets with tremendous potential for development. The confidence we have in the performance of these properties provides the foundation for our premium distribution company,” stated Bob R. Simpson, Chairman and CEO. “With this perspective, our technical team has identified another extraordinary play within TXO’s vast operated production base. The Mancos Shale is an upcoming, giant natural gas field where we hold a 58 500 contiguous- acre position that is held by production. The target holds nearly 3 trillion ft3e of natural gas potential. On an oil equivalent basis, we believe this could represent as much as five times our current total reserve base. The catalyst for action in developing this project is commodity price, and we anticipate strong natural gas economics ahead.”
“We believe the Mancos Shale development will be a game-changer for our reserve holdings and production potential,” continues Gary D. Simpson, President of Production and Development. “TXO acreage and operations reside in prime position. Offset drilling on adjoining acreage has confirmed well results. Given all the important criteria – reservoir characteristics, acreage location, productivity data, and infrastructure access – we have identified a tactical 3520 acre block as Phase I for developing and monetising reserves, representing about 6% of our current Mancos position. Specifically, our internal engineers estimate that this single position holds about 200 – 300 billion ft3 of natural gas with 25 billion ft3e estimated per drill well and has the potential to almost double our existing natural gas reserves. Importantly, the company’s acres for exploitation are held by production with no leasehold expiration dates. We expect to drill, develop, and monetise at an economically opportune time and pace. We believe this high-impact, shale project will drive extraordinary value for our owners.”
For perspective, Exhibit A reflects the summary of our Mancos Play Phase I project within the scope of the total 3 trillion ft3e of captured potential, which is in excess of 58 000 contiguous acres. The ongoing cash flow from all activities will be allocated to capital investment decisions, unit distributions, and debt management.