Unit Petroleum Company, a wholly owned subsidiary of Unit Corporation, has acquired certain oil and natural gas assets located primarily in Grady and Caddo counties in western Oklahoma from an undisclosed seller.
The purchase price is $57m along with 180 net acres in McClain County, Oklahoma. The price is subject to possible adjustments.
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The effective date of this transaction was 1 January.
The acquisition will add nearly 8,300 net acres to Unit Petroleum's Hoxbar core area situated in south-western Oklahoma.
It includes 47 Proved Developed Producing wells, 20 of which are operated by Unit and the remaining by the seller.
The acquired resources are estimated to contain around 3.2 million barrels of oil equivalent (mmboe) with an average daily net production of 1,367 barrels of oil equivalent (boe).
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By GlobalDataThis purchase offers the company with significant future resource potential, including 65 gross potential horizontal drilling locations, 13 of which are new locations.
The remaining locations are already included in Unit's planned development, but this acquisition will increase Unit's working interests within those locations.
Approximately 71% of the acreage acquired is under production. Unit will also obtain a small gathering system.
Unit president and CEO Larry D. Pinkston said: “This is an important growth step for Unit and represents an advantageous addition in one of our core areas that we have been working to expand.
“For our upstream business segment, it will increase our Hoxbar total core area position to approximately 28,000 net acres and increase our working interest in many sections.
“We plan to pick up a rig in the second quarter to continue developing the area. Coupled with the waterflood potential, we believe the value of this core holding will be significantly enhanced.”
The Hoxbar acreage position is situated next to the Norge Marchand Waterflood Unit.
Unit's Marchand wells recover more than 500mmboe in an average that is economical even under lower oil prices.
This acquisition will provide Unit with operational control to key areas of the Marchand zone of the Hoxbar reservoir for secondary recovery efforts.
The initial secondary recovery phase is estimated to improve the reserve potential from the Marchand interval by at least 500mmboe per well.
