US-based exploration and development company Lilis Energy has agreed to an acreage swap in New Mexico Delaware Basin to increase its working interests for future drilling plans.
The swap consists of an acre-for-acre trade of nearly 750 net acres in Lea County.
Under this deal, Lilis will swap the acreage belonging in non-operated sections with lower working interests.
The company stated the transaction will improve Lilis’ gross working interest (GWI) in its New Mexico Delaware Basin acreage up to 100%.
The transaction is subject to customary adjustments and is anticipated to close soon.
Lilis chairman and CEO Ronald D. Ormand said: “This transaction is another key milestone in connection with our strategic 2018 initiative to core up acreage and increase our average working interest in core operating areas.
“Following last month’s announcement of an accretive acreage exchange on our Texas property, this trade in New Mexico increases our working interests for future drilling plans, as well as in sections with four producing wells, including Wildhog 1 and 2 and Prizehog 1 and 2.
“We recently completed Wolfcamp XY and Wolfcamp A wells, in addition to previously completed Wolfcamp B wells, with excellent results in these sections.”
Upon closing, the acreage trade is expected to offer Lilis an increase in PDP and PUD reserves. The value of the deal remains undisclosed.
The company also expects the trade would prompt an immediate increase not only in the present production capacity but also the future production.
The complementary acreage will direct towards four sections of the main operational area of the company, including a 100% working interest in these sections, as well as from the Wildhog and Prizehog wells.
In March, Lilis completed the purchase and sale agreement to acquire almost 2,798 net acres in southern New Mexico in the Delaware Basin.
