Mexco announced the purchase of working interests in 160 gross acres in the Fuhrman-Mascho Field of Andrews County, Texas, for an approximate purchase price of $670,000. The Company funded the cash purchase price primarily from its $5.0 million credit facility and the balance from working capital.
This acreage contains four (4) wells, three of which are producing from the San Andres and one recently drilled well from the Grayburg and San Andres formations at an approximate depth of 5,000 feet. These wells are operated by Cone and Petree Oil & Gas Exploration, Inc. The Company owns working interests of approximately 10.8% (7.77% net revenue interest) in this property.
This property contains an additional 11 potential drill sites in the Grayburg and San Andres formations, with more dense spacing of approximately 10 acres per well. This new spacing in the Fuhrman-Mascho Field has been shown to increase production.
The Fuhrman-Mascho Field of Andrews County, Texas was discovered in 1930. This field currently contains approximately 2,400 producing wells. Cumulative production from the field to date is approximately 122 million barrels of oil and 122 billion cubic feet of gas.
"This acquisition represents a valuable addition of long-lived oil reserves for the Company with future development drilling locations surrounded by producing oil wells," said Nicholas C. Taylor, President and CEO of Mexco.
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