Strata-X Energy Ltd. (Toronto Venture: SXE) announced that the company's purchase and sale agreement to acquire 23,595 acres of production and exploration assets in the Illinois Basin has formally closed. The acquisition is known as the Copper Mountain Oil Project and is prospective for conventional and unconventional light oil accumulations in shallow Mississippian age formations (from 700 metres depth) as well as the deeper Devonian age formations (~1200 to 1600 metres depth).
Denver-based Strata-X now owns a 100% net working interest in oil and gas exploration rights on approximately 72,000 net acres covering the Vail and Copper Mountain Oil Projects in the Illinois Basin. The acreage position that Strata-X has assembled is located within a 20 mile radius of oil fields that have produced over 1.5 billion barrels of oil from a multitude of producing formations. Most of these formations are prospective under the Company's acreage.
Total consideration for the acquisition is US$2.25 million, which Strata-X funded with existing cash reserves. Included in the acquisition is a producing horizontal well which has an estimated net present value of approximately US$1.7 million as confirmed by a qualified third party reserve analyst employing a 10% discount rate.
This acquisition marks an increased focus by Strata-X on the prolific Illinois Basin where over 4 billion barrels of light oil from multiple formations have been produced. Strata-X plans to use modern exploration and completion methods to explore and develop the substantial conventional and unconventional light oil potential it has identified.
Companies report drilling and well completions activity and pricing are edging higher.
Recoverable resources are between an estimated 8 and 23 million barrels of oil equivalent, Equinor and partners say.
The company said June 9 the Longtail-3 well encountered 230 ft of net pay, but Koebi-1 was deemed non-commercial.