By year end, Houston Exploration's activity in the area is expected to increase from one rig to three rigs. Enduring Resources will pay the next $19 million of capital required net to Houston Exploration, which is funding for approximately 30 gross wells. After those capital obligations have been met all required expenses will be shared equally.
Houston Exploration's net acreage position in the Uinta Basin remains at 94,000 acres, and the gross position is now 150,000 acres. In addition, the company will retain a 100-percent working interest in the wells already drilled in the most prolific area found to date by the company.
"An agreement structured in this manner is win-win for both organizations, allowing each of us to maximize potential while minimizing risk," stated William G. Hargett, chairman, president and chief executive officer. "With additional technology and expertise, over the next 18 months we should be able to accelerate our drilling program and build an efficient gas gathering infrastructure that will optimize the production from the field," he added.
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