New wells to start drilling by end of Q1 / Additional acreage acquired
Heidelberg/Denver. Cub Creek Energy (CCE) and Elster Oil and Gas (EOG) report that they continue to invest in oil and gas development in Colorado. Deutsche Rohstoff is the majority shareholder of both companies. During the first quarter, activity will be accelerated and result in a number of new wells and further production:
– EOG will participate in seven new non-operated wells planned to spud by the end of the first quarter of 2016 from the same pad as the previously drilled 5 wells that commenced production in September 2015. These five wells continue to show excellent results with current net monthly production at 28,244 BOE. Total revenue for EOG through the end of January is estimated at USD 2.3 million.
– Nine horizontal wells were recently drilled in an area where EOG holds mineral rights through its 100% owned subsidiary Diamond Valley LLC. Production will start later this year generating revenues for EOG. At current oil prices revenues are estimated to be USD 370,000 over the first year of production. Elster does not have to contribute investment capital as the property is a non-operated asset that generates royalty revenue.
– CCE was able to sign a new development agreement adjacent to existing leases that results in securing an additional drilling pad. CCE estimates that this pad allows for up to 12 new well locations. Overall the drilling inventory has increased beyond 150 gross wells in core Wattenberg.
– CCE is currently preparing a seismic shoot over parts of its leases. The seismic is planned for early March. After the interpretation of the seismic CCE will potentially have up to four drilling pads ready for operations. Drilling on the first pad could commence as early as late March 2016 with timing mainly dependent on oil price development.
– CCE will take part in two offset wells drilled by a large operator in the basin with a 36% working interest in each well, totaling USD 2.3 million invested drilling capital for both wells combined. CCE expects excellent results from these two wells as they are drilled in a well known area with prolific production. The wells are anticipated to be spud by the end of the first quarter of 2016.
Bob Gardner, CEO of CCE and EOG, commented: “Despite the current oil price environment, we have continued to develop our acreage over the past few months. As a result, we have an excellent drilling inventory available for execution and intend to drill as many wells as economically reasonable in the coming months. Furthermore, we continue to explore opportunities to expand our inventory and acquire additional production.”
Heidelberg, 2 February 2016
Deutsche Rohstoff identifies, develops and divests attractive resource projects in North America, Australia and Europe. The focus is on the development of oil and gas opportunities within the United States. Metals, such as gold, copper, rare earth elements, tungsten and tin complete our portfolio. For more information please visit www.rohstoff.de.