Brookside-Stonehorse JV Makes Third Anadarko Basin Acquisition
Australia-based E&P companies Brookside Energy Ltd. and Stonehorse Energy Ltd., through their 50:50 Orion Project joint venture, have entered into an agreement to acquire the Thelma 1-32 well and associated acres in Oklahoma, for a total consideration of approximately US$70,000. The transaction represents the JV’s third producing property acquisition since its inception.
The Orion Project JV was formed in June this year to focus on operations in the Anadarko basin. The JV has been acquiring producing properties and associated acreage, with an emphasis on natural gas weighted production from mature vertical wells with very low terminal decline and substantial remaining economic life. In August, the JV acquired the Mitchell 12-1 well located within Brookside’s Jewell drilling spacing unit in the SWISH area.
The total consideration for the Thelma 1-32 acquisition is comprised of an initial acquisition cost of US$20,000, payable at closing, and the assumption of approximately US$50,000 of asset retirement obligations. Costs associated with the acquisition of the well and the associated acreage, as well as the cost of the work-over (estimated to be around US$149,000) will be funded equally by Brookside and Stonehorse.
The acquisition includes a 100% interest in the Thelma 1-32 well, 40 acres (held by production) and existing infrastructure located in Murray County, Oklahoma, situated 20 miles east-northeast of Brookside’s Jewell unit. Cumulative production from the well is approximately 57,000 barrels of oil since inception. Successful restoration of commercial production in the well will establish a new area of interest for the JV, complementing the SWISH area of interest. Workover operations are set to commence shortly, with a rig expected to be moved on to location in November 2020.
“This latest deal is another example of our teams’ ability to remain disciplined and focussed on returns and still deliver significant growth potential from the Producing Property Acquisitions pillar of our business. We are very much looking forward to providing further updates from this new and exciting AOI as we optimise production and further investigate the significant underdeveloped potential in the area,” said David Prentice, Managing Director of Brookside.