PYR Energy Acquires Acreage in Texas
PYR Energy has closed a strategic acquisition of a Texas natural gas property, from multiple private entities, for $1.7 million in cash. The acquisition of the Hansford County property allows the Company to consolidate working interest and operations in a field which offers significant development drilling opportunities. The transaction, which has an effective date of December 1, 2005, includes externally estimated 'Total Proved' reserves of approximately 1.950 Bcf, of which 86% of the reserves are classified as 'Proved Undeveloped'. The Company also estimates additional 'Probable' reserves on the approximate 2265 acres of leasehold included in the transaction. PYR will own 100% working interest on the majority of the acreage which includes two producing wells in addition to the recently drilled Lackey GU #2 well that has been cased, and is currently awaiting completion. The Company plans to complete the Lackey GU #2 and drill two additional PUD locations in the first quarter of 2006.
"This transaction is a positive step in our strategy to add core areas of low risk gas opportunities which offer significant upside to our overall drilling portfolio. The Hansford area offers multiple potential pay horizons at depths less than 8000 feet, and gaining operations will allow us to control the development pace and activity level," stated President and Chief Executive Officer Scott Singdahlsen.
At the Mallard prospect, in Uinta County, Wyoming, the #1-30 Duck Federal well has been completed and is currently awaiting final hook-up to processing and sales. Based on logging results and reservoir pressure tests indicating approximately 3800 psi, 177 net feet of reservoir were perforated and stimulated, within eleven separate zones covering a 333 foot gross interval, in the well. Due to the high H2S content (17 to 20%), a limited 'clean-up' flow back was accomplished and indicated flow rates of approximately 10 MMcf per day with associated liquid production. The Company believes that additional, un-perforated, pay exists in the wellbore. It is anticipated that the well will be brought on-line the first week in January, and at the point that stabilized flow rates are reached, production data will be released. The Company owns a 28.75% working interest in the well and surrounding acreage.
Completion activities are ongoing at the Chism #1 well (Tortuga Grande Prospect) in East Texas. Multiple zones within the Travis Peak have been perforated and stimulated, yielding a modest amount of oil recovery. Flow testing of the Travis Peak will be initiated by year-end, and once completed, it is anticipated that the Rodessa will be completed and tested. Rodessa production, within 3 miles to the north and northeast of the Chism location, has yielded cumulative production ranging up to 6.4 Bcfe per well. The Company is participating in the completion of the Travis Peak and Rodessa with its 28.57% working interest.
At the Wilburton Field in Oklahoma, the Schraff #5-1 is currently undergoing final completion activities, and should be placed on sales prior to the year end. It is anticipated that the well will initially produce at rates exceeding 20 MMcf per day based on flow testing to date. The Schraff #6-1 well was spud on November 30, 2005 and is currently drilling ahead below 9000 feet. The Company is participating in the completion and drilling activities with a 2.42 % working interest.
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- Samson Ups Price in PYR Tender Offer (Apr 25)
- PYR, Samson Move Closer Toward Merger (Apr 11)