This strategic acquisition further expands IPR's E&P activities in the USA with significant upside potential in existing oil and gas production and near term delineation and development opportunities in Texas Gulf Coast onshore geological trends; significant exploration opportunities associated with deep shelf exploration prospects in the Texas State Waters (TSW), Gulf of Mexico, with multiple international partners; and working interest in an emerging coal bed methane play operated by Pioneer Natural Resources in northwest Colorado.
IPR will gain instant access to operated and non-operated interests in several Gulf Coast fields with ongoing and budgeted work programs in very promising areas. Several development locations are planned for the fourth quarter of 2007 and 2008, in addition to an aggressive workover and behind pipe recompletion program. IPR forecasts onshore production to double by the end of 2008 and plans to continue this trend for the next several years.
Over 40 prospects and leads have been defined and delineated along the TSW by the current team of highly qualified geoscientists and engineers which have significant upside resource potential along the shelf. IPR has taken over operations of the current drilling campaign ranging in depths between 15,000 to 21,000 ft. IPR will retain approximately 55% working interest in the various offshore leases which total over 65,000 gross acres. The project areas will include pursuit of the Frio, Vicksburg, Yegua, Wilcox and Miocene trends.
The coal bed methane project, targeting the Williams Fork formation in the Sand Wash Basin, falls within 80,000 acres held in northwest Colorado. Significant resource potential is projected by the operator, where 14 wells were drilled in two pilot projects with positive results. Current deeper Niobrara formation production testing indicates additional positive oil and gas potential across the lease block which may develop into a major new play for the area. This is within the Bureau of Land Management's 4.2 million acre administrative area where 10.2 million barrels of oil and 9.8 million cu. ft of gas have been produced through December 2004. IPR currently holds a 25% working interest in this highly prospective large block area.
This is IPR's third major stock acquisition of an existing major in the past decade, which was followed by Phillips Petroleum and Devon Energy International's Egypt assets.
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