Executive Chairman Kevin Sylla added that the location of the Piceance assets to the proposed Jordan Cove LNG facility and marine terminal has positive long-term implications for Foothills as well. (Source: Hart Energy)
[Editor's note: This story was updated at 8:30 a.m. May 9.]
Foothills Exploration Inc. said May 2 it is adding to its position in the Rockies with an agreement to acquire Piceance Basin assets.
The Piceance assets comprise roughly 22,598 gross (19,985 net) acres of natural gas producing properties in the western side of the basin, which lies in northwestern Colorado. The properties have about 80 wells that come with existing infrastructure.
Of the 80 wells, about 50 are shut-in or produce intermittently and 30 are currently producing stripper amounts of natural gas from multiple formations including the Dakota, Mesa Verde and Mancos B.
Foothills said it entered into a confidential memorandum of understanding with an undisclosed seller for the acquisition, which is scheduled to close by the end of May.
The company is in discussions with its financial advisers on securing debt financing to close the transaction and fund a production enhancement program to rework about 15 shut-in wells with immediate production growth potential, according to is press release.
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“This acquisition will potentially provide the company significant exposure to future natural gas development and reserves,” Kevin Sylla, Foothill’s executive chairman, said in a statement.
Sylla added that the location of the assets to the proposed Jordan Cove LNG facility and marine terminal in Oregon has long-term positive implications for Foothills as well.
If approved, Jordon Cove will be capable of receiving about 1.3 billion cubic feet per day of natural gas and also enable the transport of LNG from the U.S. West Coast to Asia.
“We believe from a supply perspective that there is long-term value creation potential in acquiring natural gas weighted assets in the Rockies with stacked-pay, long-lived reserves and upside development opportunities,” Sylla said.
Foothills, a Denver-based independent oil and gas company, currently holds more than 7,000 acres in the Greater Green River and Big Horn basins of Wyoming and is also “actively seeking to grow its footprint in the Rocky Mountain and Gulf Coast regions,” according to the company’s website.
Emily Patsy can be reached at epatsy@hartenergy.com.
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