- Black Mountain Energy (BME) is set to acquire NYSE-listed Earthstone Energy’s interest in an oil and gas field in the Permian Basin in New Mexico
- Earthstone’s interest includes eight operating wells and leases, referred to as the ‘Half Moon’ prospect
- BME says the acquisition diversifies the company and offers steady production revenue while it continues to develop its flagship natural gas project
- The company believes there is greater potential to unlock further value from the existing fields using geologic and engineering methods
- BME shares close 3.23 per cent higher at 3.2 cents on Wednesday afternoon
Black Mountain Energy (BME) has agreed to acquire 100 per cent of NYSE-listed Earthstone Energy’s interest in an existing oil and gas field in the Permian Basin in New Mexico.
Earthstone’s interest includes eight operating wells and leases, referred to as the ‘Half Moon’ prospect, located in the northwestern corner of the US Delaware Basin.
The prospect has proven petroleum systems, and the wells being acquired by BME have produced nearly 3 million barrels of oil equivalent from the lease.
Black Mountain said the acquisition diversified the company’s business model and offered steady production revenue as it continued to develop its flagship natural gas project in the Canning Basin in Australia.
“The assets provide the company with an ability to diversify and generate immediate revenue through acquiring a portfolio of producing wells as we continue to develop the Valhalla project,” Black Mountain Executive Chairman Rhett Bennett said.
“The assets provide another operating nexus for us to drive value creation for shareholders, through existing production and possible future drilling.”
The acquisition will provide approximately 465 mcfepd (77 boepd) of net non-operated production from eight proved developed producing (PDP) wells.
Black Mountain believes there is potential to unlock further value from the existing fields using geologic and engineering methods.
BME shares closed 3.23 per cent higher at 3.2 cents on Wednesday afternoon.