Perth - Brookside Energy Limited (ASX: BRK) (Brookside) and Stonehorse Energy Limited (ASX: SHE) (Stonehorse) (the Companies) are pleased to provide an update on the operation of the Orion Project Joint Venture (the Joint Venture).
The Joint Venture is targeting producing properties and associated acreage Held by Production (HBP).
HIGHLIGHTS
The Joint Venture has executed a purchase and sale agreement for its third producing property acquisition, the Thelma 1-32 well, including the associated 40 HBP acres and existing infrastructure (the Thelma Well).
The Thelma Well is located in Murray County in the southern part of the SCOOP Play, approximately 20 miles east-northeast of Brookside's Jewell DSU.
The Black Mesa team have identified a number of high potential target formations in the Thelma Well (a vertical well drilled in the early 1990's) including material behind pipe volumes.
This third acquisition (in less than four months) expands on the Orion Project's scope and scale by adding virgin proved developed not producing (PDNP) reservoirs and their untapped volumes to future potential production.
The footprint of the Orion Project has now been expanded to encompass a new area outside of the SWISH area of interest (AOI) with considerable upside potential from additional PDP acquisitions and/or development opportunities.
Workover operations are set to commence shortly with a rig expected to be moved on location early next month.
Black Mesa continues to work up additional acquisition targets within the SWISH AOI and the wider southern Anadarko Basin area, advancing these opportunities and adding to the list of acquisition targets.
Commenting on the announcement, Brookside Managing Director, David Prentice said: 'We are once again delighted to bring news of another successful Orion Project Joint venture acquisition to our shareholders. 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.'
Stonehorse Managing Director, David Deloub said: 'As scale and holding acreage by production is the key to the Orion JV we are very pleased to announce a third acquisition within four months of the Joint Venture's operation. In addition to providing several high potential targets in this well this also expands our footprint and establishes a new AOI in Murray County'.
The Joint Venture has successfully closed its third producing property acquisition opportunity (the Thelma Well) in its first four months of operation. The Joint Venture was formed in mid-June 2020 to target mature long-life production assets with very low terminal decline and upside that can be unlocked from remedial workover activity and/or unexploited or underexploited behind pipe or deeper productive zones.
The Thelma Well, which is located in Murray County, Oklahoma was drilled and completed in 1992 as a vertical well targeting the Simpson Group and was spaced on a 40-acre drilling spacing unit (DSU). The well is located approximately 20 miles east-northeast of Brookside's Jewell DSU in the SWISH AOI in an area that can exhibit high oil production per unit with multiple discrete high porosity high permeability target zones.
The Thelma Well has produced approximately 57,000 barrels of oil to date which, based on the internal estimates prepared by Black Mesa, indicates that material volumes are still to be extracted from producing zones or behind pipe formations, making this well a prime workover candidate. Successful restoration of commercial production in the Thelma Well will establish a new AOI for the Joint Venture complementing the SWISH AOI.
Workover operations are set to commence shortly with a rig expected to be moved on location early next month. Workover operations will include inspection and repair or replacement of both surface and downhole production equipment as well as a 'clean-up' of the perforated intervals to optimise the existing production. Future work will include adding further production and cashflow through recompletions of already identified behind pipe reservoirs that have produced in offset wells surrounding the Thelma Well.
The costs1 associated with the acquisition of the well and the workover will be met by the Joint Venture partners (50/50) in accordance with the terms of the agreement. The Joint Venture is continuing to work up a pipeline of opportunities. The Black Mesa team have already identified a large number of potential acquisition targets both within the SWISH AOI and more broadly in the southern Anadarko Basin region that satisfy the Joint Venture's investment hurdles and work to advance these opportunities and add to the list of targets is ongoing.
This announcement has been authorised for release by the Boards of Directors of Brookside Energy Limited and Stonehorse Energy Limited.
Contact:
David Prentice
Tel: (+61 8) 6489 1600
Email: david@brookside-energy.com.au
Forward-Looking Statements and Other Disclaimers
This announcement may include forward-looking statements. Forward-looking statements are only predictions and are subject to risks, uncertainties and assumptions, which are outside the control of Brookside Energy Limited and/or Stonehorse Energy Limited ('Brookside Energy', 'Stonehorse Energy' or 'the Company'). These risks, uncertainties and assumptions include commodity prices, currency fluctuations, economic and financial market conditions in various countries and regions, environmental risks and legislative, fiscal or regulatory developments, political risks, project delay or advancement, approvals and cost estimates. Actual values, results or events may be materially different to those expressed or implied in this announcement. Given these uncertainties, readers are cautioned not to place reliance on forward-looking statements. Any forward-looking statements in this announcement speak only at the date of issue of this announcement. Subject to any continuing obligations under applicable law and the ASX Listing Rules, Brookside Energy and Stonehorse Energy do not undertake any obligation to update or revise any information or any of the forward-looking statements in this announcement or any changes in events, conditions or circumstances on which any such forward looking statement is based. This announcement does not constitute investment advice. Shareholders should not rely on this announcement. This announcement does not take into account any person's particular investment objectives, financial resources or other relevant circumstances and the opinions and recommendations in this announcement are not intended to represent recommendations of particular investments to particular persons. All securities transactions involve risks, which include (among others) the risk of adverse or unanticipated market, financial or political developments.
The information set out in this announcement does not purport to be all-inclusive or to contain all the information, which its recipients may require in order to make an informed assessment of Brookside Energy or Stonehorse Energy. You should conduct your own investigations and perform your own analysis in order to satisfy yourself as to the accuracy and completeness of the information, statements and opinions contained in this announcement. To the fullest extent permitted by law, the Company does not make any representation or warranty, express or implied, as to the accuracy or completeness of any information, statements, opinions, estimates, forecasts or other representations contained in this announcement. No responsibility for any errors or omissions from this announcement arising out of negligence or otherwise is accepted.
About Brookside Energy Limited
Brookside Energy is a Perth-based ASX listed company that generates shareholder value by developing oil and gas plays in the United States, specifically the Anadarko Basin in Oklahoma. The Anadarko Basin is a proven Tier One oil and gas development province with significant existing oil and gas gathering and transportation infrastructure, a competitive and highly experienced oil and gas service sector, and a favourable regulatory environment. Brookside is executing a 'Real Estate Development' approach to acquiring prospective acreage in the Anadarko Basin and adding value to it by consolidating leases and proving up oil and gas reserves. The Company then has the option of selling the revalued acreage or maintaining a producing interest. The Company is now set to scale-up its activities and asset base significantly with its operated- interests in the SWISH AOI.
About Stonehorse Energy Limited
Stonehorse Energy is a Perth-based ASX listed oil and gas exploration and production company which currently has working interests in a number of producing oil and gas assets located in Oklahoma and Texas in the United States. The Company's overall objective is to be cashflow accretive by building a portfolio of working interests in high quality producing assets delivering a return on investment to its shareholders reflecting risk appetite and capital availability.
About Black Mesa Energy, LLC
Black Mesa Energy, LLC is a Tulsa-based oil & gas exploration and production company focused on profitable development of petroleum properties located in the Mid-Continent oil province of the United States. Our lean and highly specialized technical and operations team is committed to providing attractive returns for our investors and shareholders by generating and drilling high quality oil and gas prospects. The founders of Black Mesa have worked together for over 30 years at companies they previously founded, including Medallion Petroleum, InterCoast Energy and Brighton Energy. Over the course of their careers, the Black Mesa team has drilled hundreds of horizontal wells and thousands of vertical wells in numerous mid-continent oil and gas basins. In addition to the financial backing from the Black Mesa shareholders, Black Mesa partners with outside investors on larger-scale projects by offering non-operated direct working interest participation.
BROOKSIDE ENERGY LIMITED 