Exploration and production company EnerJex Resources has commenced natural gas production at D-Sand wells in the Adena field in Colorado.
Production has commenced under an improved purchase contract in Morgan County, in which the company owns a 100% working interest in around 19,000 acres.
Discover B2B Marketing That Performs
Combine business intelligence and editorial excellence to reach engaged professionals across 36 leading media platforms.
Production has been initiated at a rate of around 500,000ft² of liquids-rich natural gas a day at the field, which equates to around 100 barrels of oil equivalent (BOE) a day.
EnerJex is also building a pipeline which it expects will result in the commencement of natural gas production from at least one J-Sand well during the first quarter and is set to cost less than $100,000.
As part of a new five-year contract, natural gas from the Adena field will be sold at a significant premium to the price the company received in the past under a prior arrangement.
Under the contract, the company is expected to receive around 80% of end-market natural gas pricing, including the sale of associated natural gas liquids.
US Tariffs are shifting - will you react or anticipate?
Don’t let policy changes catch you off guard. Stay proactive with real-time data and expert analysis.
By GlobalDataAccording to the Colorado Oil and Gas Conservation Commission, Adena has produced 75 million barrels of oil and 125 billion cubic feet of natural gas.
EnerJex CEO Robert Watson, Jr said that in recent weeks, natural gas prices have increased substantially due to unusually cold weather and are expected to remain strong throughout 2014.
"As a result, EnerJex has accelerated the pace of its natural gas development and I expect this to have a meaningful impact on the company’s production and cash flow in 2014," Watson added.
