US-based Forest Oil Corporation has acquired 68,500 gross acres in the Permian Basin, prospective for the Wolfbone oil play in Pecos and Reeves Counties, Texas.
The company purchased the acreage for $66m in cash and about 2.7 million shares of its common stock.
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The transaction takes Forest Oil’s total Permian Basin acreage position of 57,500 gross acres to 126,000 gross acres.
The acreage acquired is concentrated in large, contiguous positions in both Delaware and Midland basins, and the company is planning to commence testing the Wolfbone formation in the first half of this year.
Forest Oil president and CEO H. Craig Clark said the acquisition of the Wolfbone acreage fulfils the company’s aim to develop an acreage base that offers exposure to a number of oil objectives, with vertical and horizontal drilling opportunities.
The Delaware Basin acreage position of the company is mainly prospective for the Wolfbone interval, including the Third Bone Springs and Upper Wolfcamp formation.
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By GlobalDataThe acreage also has potential in the Delaware Sands, the Upper Bone Spring Sands and the Avalon shale.
Forest Oil plans to develop its Wolfbone acreage, which contains primary lease terms of three to five years, through vertical delineation drilling and commingling a number of the stacked pay zones in the basin.
The company said it may transition to horizontal completions to optimise the play’s development.
Forest Oil is focused on the acquisition, exploration, development and production of natural gas and liquids in the US and selected international locations.
