Warren Resources Completes Purchase of North Wilmington Unit
Warren Resources, Inc. reports that effective December 31, 2005, it completed the purchase of a 100% working interest (subject to pre-existing unaffiliated royalty burdens of 15.4%) in the North Wilmington Unit (NWU) oil field in the Los Angeles Basin in California for $23 million in cash. The Company estimates that the NWU contains proved oil reserves of approximately 23.4 million barrels gross, 19.8 million net. The NWU currently produces approximately 400 gross barrels of oil per day from 46 active wells and it is adjacent to the Company's operated Wilmington Townlot Unit (WTU) in the Wilmington oil field. The acquisition of the NWU includes 11.87 acres of fee surface properties, a central procession facility, oil field equipment and all lease, contract and related rights.
The Company estimates that the NWU has 1.7 million barrels of net proved developed producing oil reserves (PDP), and 18.1 million barrels of net proved undeveloped oil reserves (PUD) providing for future infill drilling and secondary recovery water flood opportunities. The NWU contains 73 inactive wells, many of which the Company believes may be returned to production through workovers and other remedial activities. The Company was appointed the operator of the NWU and has budgeted $10 million in 2006 for facilities upgrades, remedial work on 18 idle wells and drilling four new wells in the NWU.
Norman F. Swanton, Chairman & CEO, commented for Warren Resources,
"2006 should be a year of significant production growth for the
Company. Our large-scale drilling projects in the Wilmington Townlot
Unit and the North Wilmington Unit in California could provide triple
digit production growth for us in 2006. Additionally, upon completion
of the current environmental impact statement in 2006 for the Atlantic
Rim coalbed methane project in the Washakie Basin in southwest
Wyoming, we will have the flexibility to accelerate the pace of
development drilling of potentially high quality CBM wells with our
Atlantic Rim joint venture partner, Anadarko Petroleum. We look
forward to capitalizing on the Company's large acreage position and
extensive drilling opportunities in both of these areas."
- Warren Resources Files for Chapter 11 Bankruptcy (Jun 02)
- Oil Boom Built on Junk Debt Sees $19B Default Wave (Mar 11)
- Warren Resources Increases 2013 Capex (May 20)