Brookside and Stonehorse Form New JV to Pursue Anadarko Basin Opportunities
Australia-based E&P companies Brookside Energy Ltd. and Stonehorse Energy Ltd. have announced the formation of a new 50:50 joint venture to jointly seek opportunities in the Anadarko basin in the United States.
The joint venture, named the Orion Project JV, will compile a portfolio of operated, long-life producing well-bores that can be unlocked through low-cost, low-risk maintenance activities. The companies have committed to an initial combined investment of US$500,000.
The Orion Project will have an initial focus area of 1,100 sq. km in the Anadarko Basin that contains historic and currently producing oil and gas fields and multiple vertical well-bores.
“The JV will be acquiring producing properties and the associated ‘Held by Production’ acreage, with an emphasis on natural gas weighted production from mature vertical wells with a very low terminal decline and substantial remaining economic life,” Brookside said in a statement.
Under the terms of the JV, Brookside’s subsidiary Black Mesa Energy LLC will be responsible for identifying, acquiring, and operating the properties on behalf of the companies, and in exchange will receive an 18.75% working interest back-in after payout on the acquired assets.
Work has commenced on the project, and the JV has already acquired, analyzed and interpreted comprehensive data sets covering past and current production, geology, reservoir characteristics, drill core, and 2-D seismic. The acquired data and analysis are being used to refine and target opportunities, with discussions underway for several targets. The companies stated that the project can also be scaled-up to include other basins in Oklahoma outside of the Anadarko basin.
“This new venture affords us the opportunity to continue to build out our oil and gas asset portfolio by leveraging off our existing relationships with our JV partner and the technical team at Black Mesa through the acquisition of producing properties within our focus area in a low commodity price environment”, commented David Deloub, Executive Director of Stonehorse.
Both companies believe the recent sharp fall in commodity prices due to the ongoing Covid-19 pandemic has created a significant upside opportunity for them to cash in on.