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Abraxas Petroleum Corporation
is pleased to provide an
operational update, announce the closing of the Company's non-operated Bakken
asset sale and provide an activity, CAPEX and production guidance update.
Operational Update
In McKenzie County, North Dakota, Abraxas successfully remediated the sand
plug on the Lillibridge 4H. The Lillibridge 4H, producing from the Three
Forks, is currently producing 1,436 boepd (1,112 barrels of oil per day, 140
barrels of NGLs per day, 1,105 mcf of natural gas per day) on a 20/64” choke.
Combined, the four wells on the company's Lillibridge East pad are producing
approximately 5,503 boepd (4,036 barrels of oil per day, 721 barrels of NGLs
per day, 4,476 mcf of natural gas per day). Abraxas owns a working interest of
approximately 34% in the Lillibridge East pad.
Non-Operated Bakken Closing
Abraxas recently closed the sale of its non-operated Bakken assets for $38.3
million after accounting for purchase price adjustments. Accounting for the
asset sale, Abraxas' credit facility was revised to $143 million. After
providing the company's updated June 30, 2013 internal reserve report to the
company's bank group, Abraxas will undergo its fall redetermination process.
Given the activity levels and reserve adds from the company's Eagle Ford and
Bakken assets over the last six months, it is management's expectation that
the facility will increase from $143 million.
Activity, CAPEX and Production Guidance Update
Abraxas plans to use a portion of the additional liquidity following the
non-operated Bakken asset sale to accelerate growth in its core regions.
Additions to the capital program include the following:
Eagle Ford: Abraxas currently holds 100% working interest in approximately
4,400 net acres in Atascosa County, TX in the Jourdanton Prospect. In
September 2011, Abraxas completed a lateral in the Eagle Ford, the Grass Farm
1H, as part of the Blue Eagle Joint venture on the same prospect. This well
averaged a modest 103 BOPD over its first 30 days of production, but the
relatively flat decline rate has yielded cumulative production of 40,000 BO.
Since completion of the initial well, Abraxas acquired a new 3D seismic
survey, and interpretation indicates that the Grass Farm 1H was only in the
target zone about 10% of its lateral length. Also, recent completions by area
operators at similar depths (8,000-8,200 ft) have shown marked improvement in
initial rates. The company plans to drill one 100% working interest Eagle Ford
horizontal in late September 2013 at an estimated completed well cost of $6
million.
Abraxas also recently secured a new 410 net acre prospect in northern McMullen
County. The lease will accommodate up to four Eagle Ford laterals with
anticipated lengths of 7000-9000 ft. Abraxas plans to spud an initial well in
the 4^th quarter of 2013 with 100% working interest.
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