The following information is provided by Detring Energy Advisors LLC. All inquiries on the following listings should be directed to Detring. Hart Energy is not a brokerage firm and does not endorse or facilitate any transactions.
Rio Oil and Gas (Permian) II LLC retained Detring Energy Advisors for the sale of a core Delaware Basin nonop opportunity in Ward County, Texas.
The offer comprises of nonoperated working interest and related assets in the Block 18/War Wink Field of Ward County within the Permian Basin. According to Detring, the company's exclusive adviser for the transaction, the assets offer an attractive opportunity to acquire an 8.33% working interest with a relatively low royalty burden (1/6th) ahead of a significant horizontal well program operated by Chevron USA Inc.
Drilling operations have commenced on the initial five well pad with Chevron indicating it plans to spud a second five well pad immediately following the drilling of the initial pad. A total of 10 wells are expected to be completed and online prior to Dec. 31, 2020, Detring said.
- 8.33% in a roughly 3,364 contiguous gross acre contract area in the core of current Ward County horizontal development
- 6.94% Net Revenue Interest (1/6th effective royalty burden)
- Large, contiguous footprint allows for extended-reach laterals
- Operated by Chevron Corp., a premier Delaware Basin operator
- Acreage is 100% HBP by long-life, low-decline vertical production (about 30 barrels per day of oil net, roughly 7% next 12-month decline)
- Anticipated Large Scale Horizontal Development Program
- University Lands development contemplates about 30 extended-lateral wells (six pads) to be drilled on the assets by the end of 2023 (about four years)
- The first five-well pad has already spud, with a second five-well pad expected to spud immediately thereafter (10 wells expected turn-in-line by end-of-year 2020)
- There are no legacy (parent) horizontal wells on the acreage; the development program will have the benefit of optimum reservoir management from its inception
- Simultaneous, Multi-Bench Development Imminent
- Prolific stacked-pay in the deep, overpressured core of the most active basin in the U.S.
- Robust type curves generate IRR’s of 70%-plus (WCA / BS3) in current pricing environment
- Future development potential in multiple Wolfcamp and Bone Spring horizons (four to six wells per mile)
- Evaluation materials available via the Virtual Data Room on Oct. 21
- Proposals due on Nov. 20
Detring said the seller anticipates executing a purchase and sales agreement by mid-December, with closing occurring in January.
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