Cadence holds oil & gas leases on approximately 3200 acres of contiguous property in De Soto Parish in the highly productive Bethany-Longstreet field. The terms of the deal call for Bridas to drill the first well on the property to a total depth of not less than 10,000 feet targeting productive horizons of the Hosston and Cotton Valley formations. This well is expected to cost approximately $1.3 million dollars. In this first well Cadence will be carried to production for a 25% working interest.
"Bridas has told us they plan to spud the first well by the end of May, and should reach total depth by June 30th", said Lucius Geer, Cadence's Project Manager.
On subsequent wells within the 640 acre section containing the first well, the Company will earn a 25% percent working interest by funding 25% of the drilling, completion, and facilitation expenses. On other wells outside of the original 640-acre section, the Company will earn a 45% working interest by funding 45% of the expenses. On average, the leaseholds the Company controls carry an approximate 80% net revenue interest.
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