Avalon Oil & Gas Inks Deal to Acquire Texas Acreage
Avalon Oil & Gas has signed a letter of intent to acquire a 50 percent working interest, in an oil and gas lease in Starr County, Texas, from Canyon Creek Oil and Gas. The 266.73-acre property has four shut-in oil and gas wells.
The lease is located in the Boyle Field, an oil field that has produced nearly 1.3 million barrels of oil. Avalon conservatively estimates that the field contains a similar amount of remaining oil reserves and 242,900 mcf of gas.
Avalon and Canyon Creek will hire an engineering firm to oversee the implementation of a water flood project to recover the maximum amount of oil from the reservoir. Once the water flood procedure is fully operational, Avalon projects monthly cash flow--assuming prices of $60/barrel of oil and $6.50/mcf of gas--at nearly $500,000, after deducting for lease royalties, operating expenses, and taxes.
Avalon plans to drill and complete 10 additional wells during the next 12 months to further develop the oil reserves. Oil production is projected to reach 1,000 barrels of oil per day when the lease is fully developed.
Canyon Creek is a subsidiary of Universal Property Development and Acquisition Corp..
- UPDA: All Wells Back Onstream by Christmas (Nov 30)
- Avalon Oil & Gas Inks Deal to Acquire Texas Acreage (Apr 06)
- Canyon Creek Preparing to Start Production at Palo Pinto Field (Feb 21)
Company: Universal Property Development and Acquisition Corp. more info
- UPDA's Year-End Boasts: Acquisitions Galore, from Aztec to Heartland (Jan 02)
- Catlin Oil Set to Close Palo Pinto Acquisition (Aug 06)
- UPDA Agrees to Buy Well Testing Vendor (Dec 18)
Company: Avalon Oil & Gas more info
- Avalon Picks Up Acreage in Anadarko Basin (Sep 16)
- Avalon Enters LOI to Acquire Leasehold in Vernon County (Jul 12)
- Avalon Acquires Leasehold in Mississippi (Feb 02)