Mexco Energy is participating as a working interest owner in a joint venture drilling four vertical development wells to a depth of 11,000 ft on 160 acre spacing in the Dean, Wolfcamp, Cline and Atoka formations on 640 acres in Reagan County, Texas.
Initial per day production rates from two of these wells respectively are 128 barrels of oil and 110,000 cubic ft of natural gas and 94 barrels of oil and 179,000 cubic ft of natural gas. Mexco’s working interest in this joint venture is .3% (.24% net revenue interest).
These wells will hold the deep rights for further development by horizontal drilling. The Wolfcamp formation in this area is an approximately 1,700 ft thick section consisting of interbedded organic shales and carbonates and includes two reservoir units, the "A" and "B" benches that have both been successfully developed with horizontal wells.
These four vertical wells in Reagan County, Texas are in addition to two horizontal wells in which Mexco is participating in Reagan County, Texas as previously announced on February 27, 2014.
Also, Mexco has acquired for $450,000, a package of non-operated producing properties consisting of 10 oil wells and one gas well located in Webster Parish, Louisiana; Eddy County, New Mexico; Billings County, North Dakota; and, Nolan and Smith Counties, Texas. The purchase price was funded from the Company’s $4.9 million bank credit facility.
This purchase, effective March 1, 2014, includes working interests ranging from 27.5% to .13% (net revenue interests of 24.06% – .11%) adding estimated net proved reserves of approximately 35,000 barrels of oil equivalent at a cost of $12.86 per barrel.
