Osage Exploration and Development has assembled a sizeable acreage footprint in domestic hydrocarbons, with an emphasis on working Horizontal Mississippian vectors in Oklahoma (in addition to the company’s majority interest in the Guaduas field in Colombia), releasing news today about their latest E&P achievement, the spudding of a third horizontal well (Davis Farms 2-5H) on the company’s 28k-acre Nemaha Ridge project in Logan County, Oklahoma.
Two miles south of OEDV’s Wolf 1-29H well, the Davis Farms 2-5H (which follows fast on the heels of the drilling of its disposal well, the Davis Farms 1-5 SWD) hopes to produce initial production rates similar to the Wolf 1-29H (1,185 barrels per day in initial 72-hour period, with an 84% forty degree gravity crude oil and 16% high BTU wet gas, Wolf 1-29H is one of the best targets executed in the play thus far).
Nemaha Ridge is being developed in conjunction with OEDV’s operational partners, both of whom have extensive Oklahoma presence and decades in the industry, Slawson Exploration Company and US Energy Development Corporation (USEDC). The widely acclaimed Slawson has been at this sort of work for over five decades and has a regional office in Oklahoma to support activities (over 3,500 wells drilled in 10 states, with some of the first horizontals under its belt from back in the 80’s). USEDC grew out of Oilmark & Company, Inc., founded back in 1978, and is today regarded as one of the top 50 independent domestic hydrocarbon drillers with extensive work in both NY and Pennsylvania (operator status on over 2,500 well drillings since inception).
The Nemaha Ridge project is brilliantly engineered and the execution has just been superb. Osage has some of the best operational logistics available and is flexing this muscle with an aggressive attitude towards acquisitions in Oklahoma, as well as onshore U.S. targets in general.
Chairman and CEO of OEDV, Kim Bradford, underscored the recently announced 40% expansion of the acreage position across the Mississippian, with OEDV’s own position via the 25% working interest rising to as much as 7k net acres. Bradford deliberately showed his hand here, making it very clear that OEDV is intent on seizing a large horizontally-viable position in the play, confident that a strategy of moving to drill every single acre under lease will provide the greatest shareholder value accumulation.
Bradford further emphasized OEDV’s proven ability to simultaneously bring in impressive production results and expand the acreage footprint in the core operating area, citing that the company was no longer alone regionally, as three of the largest public E&P companies operating in the state have recently set up shop in Logan County as well (even drilling on contiguous acreage).
Director and VP of Exploration at OEDV, Greg Franklin, echoed his colleagues’ statements wholeheartedly, adding his own observation that the economic viability of the Horizontal Mississippian is now a widely-known fact among the industry’s top analysts. Franklin pointed to volatile commodity prices as making the superior well economics (as expressed by OEDV’s portfolio) especially attractive.
Franklin cited extant E&P efforts as proof in-and-of-itself that OEDV can execute on this methodology and bring oil to the surface cheaply, yet with a maximum respect for the land and water table. So far, expectations have not only been met in this regard, but exceeded, with the theoretical work being done by OEDV realized through optimal production solutions and the latest in horizontal technology.
OEDV has proven a capacity for elegantly partnering its way into more and more stable configurations, with the Guaduas Field and Guaduas-La Dorada Pipeline projects down in Colombia offering a solid test group, the health of OEDV’s strategy seems clear and the future certain.
For more information on San Diego-based, Osage Exploration and Development, Inc. (production offices in OKC and also down in Bogota), please visit the company’s website at: www.OsageExploration.com
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