SandRidge Energy is acquiring the assets of privately-held EE3 in the Niobrara Shale for $190 million in cash, Kallanish Energy learns.
With the deal, independent producer SandRidge said it will have a material, de-risked Niobrara Shale position in the North Park Basin in Jackson County, Colorado. The 136,000 acres acquired is largely concentrated in a rural areas “ideal for pad drilling and efficient infrastructure installation.”
“Expanding into a proven, high quality, repeatable oil play leverages our core competencies in medium depth horizontal drilling, unconventional development, infrastructure, and cost reduction,” said James Bennett, SandRidge CEO. “We will be mobilizing to spud our first well in January.”
The buy includes a large, concentrated acreage position in Niobrara Shale play that has five stacked benches at depths of 5,500 to 9,000 feet, reservoir thickness over 450 feet, oil in place greater than 55 million barrels per section and an overpressured reservoir, according to SandRidge.
The estimated ultimate recovery (EUR) per well of 311,000 barrels of oil-equivalent generates 32% internal rates of return at recent strip pricing with well costs below $4 million, SandRidge said. The buy holds an estimated 27 million barrels of oil-equivalent (MMBOE) of proved reserves (82% oil).
Roughly 47% of the 136,000 acres are held by production and by two Federal units.
Note: Read all of the Kallanish Commodities Energy News which is published daily online, www.kallanishenergy.com. Kallanish also publishes a daily newsletter, and will be happy to add your name to the distribution list. Simply email .