Pursuant to the participation agreement, PEDEVCO acquired a 27.9% working interest in six new horizontal D-J Basin wells in the SW Pony Prospect that were drilled and completed in the third quarter. (Source: Shutterstock)
Independent producer PEDEVCO Corp. agreed to jointly develop approximately 10,750 net acres in the SW Pony Prospect in Weld County, Colorado.
Houston-based PEDEVCO signed a five-year participation agreement “with a large, Denver, Colorado-based private equity-backed D-J Basin E&P company with extensive operational experience,” PEDEVCO said Oct. 1.
PEDEVCO and the unnamed operator have formed a roughly 16,900-acre area of mutual interest in the SW Pony Prospect, with PEDEVCO holding a 30% interest and the operator holding a 70% interest in the combined acreage.
The two parties are contemplating drilling and completing a minimum of five horizontal Niobrara wells per year over the next five years on the joint acreage.
Pursuant to the participation agreement, PEDEVCO acquired a 27.9% working interest in six new horizontal D-J Basin wells in the SW Pony Prospect that were drilled and completed in the third quarter.
The additional working interest “will add an immediate and significant production uplift” to PEDEVCO’s third-quarter results.
The area of mutual interest covers approximately 16% of PEDEVCO’s D-J Basin acreage, but does not include any acreage where the company has existing permits for its anticipated future operated development.
“We are very pleased to announce this participation agreement with one of the top operators in the D-J Basin which has consistently delivered superior well results over the last decade,” said PEDEVCO President J. Douglas Schick. “Our similar acreage footprints in the SW Pony Prospect make this collaboration a natural fit and will allow both companies to accelerate development and increase production from this highly-prospective area.”
In addition to the D-J Basin of Colorado and Wyoming, PEDEVCO has assets in the Northwest Shelf of New Mexico targeting the San Andres play.
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