PXP continues to separate its deepwater and onshore assets

Plains Exploration & Production  continues to evaluate alternatives to separate its deepwater and onshore businesses, which include separately capitalizing its deepwater business through a joint venture or outside capital and then either spinning-off or divesting these assets.

James C. Flores, Chairman, President and CEO of PXP commented, "The planned separation of our Gulf of Mexico and onshore businesses is aimed at optimizing the value of PXP's assets, both onshore and offshore. However, to-date, the deepwater separation process reflects a discounted value due to the current regulatory uncertainties, permit delays, and reduced activity for Gulf of Mexico exploration and development, rather than the underlying long-term value of this oil-weighted asset, especially in this strong energy commodity market.

"We believe it prudent to allow time for the regulatory uncertainties to abate and to complete the Lucius well test operations before proceeding. Our Lucius operator, Anadarko, recently received approval to conduct well test operations beginning late March 2011. The flow test is a key milestone to possible project sanctioning in 2011, which results in significant discovered resources becoming proved reserves. Prior to separation, potential additional drilling could occur on the current leasehold on 50,000 acres covering 10 OCS blocks to further de-risk the Lucius-Phobos complex."

Plains E&P anticipates capital exposure for these properties in 2011 of approximately $50-$60 million net to PXP with the easing of Gulf of Mexico activity curtailments.

Acquisition Metrics for PXP 

Source Derrick Petroleum E&P Transactions Database

For more on Plains Explorations & Prodcution:  Derrick Document Search

Salamander Energy reports 2010 Annual Results; Average Daily Production up 49%; Plan to achieve Production growth of 22,000-23,000 boepd

Salamander Energy’s 2010 production was 20,300 boepd up 49% over 2009. This is due to first full year of production from the Kambuna field, an increased equity interest in the Bualuang field and higher than expected production from ONWJ, where a new operator invested to increase production. The company forecasted 2011 production is expected to be between 22,000 and 23,000 boepd. Salamander achieved  reserves replacement ratio of 121%

Source: http://docsearch.derrickpetroleum.com/pageNav/view1/docId/11391-0000/Salamander_2010_Annual_Results_PPT.html

Exploration program remains active with a further 13 exploration and appraisal wells planned in 2011. The company plans to invest US$ 195 million in 2011, of which US$ 95 million for production and development activities and US$ 100 million for exploration and appraisal activities.

Source: http://docsearch.derrickpetroleum.com/pageNav/view1/docId/11391-0000/Salamander_2010_Annual_Results_PPT.html

Lukoil 2010 Results Presentation

http://docsearch.derrickpetroleum.com/pageNav/view1/docId/11031-0000/Lukoil_2010_Financial_Results.html

Wolfberry Play- the Monarch of Permian Basin!!

In the recent days, the oil and gas industry sees many oil-weighted plays grooming up.. One such play is Wolfberry play- The Monarch of Permian Basin!!

The Wolfberry play is named after the two main productive formations, the low-permeability Wolfcamp and Spraberry. The Wolfberry play is spread across Midland, Upton, Martin, Howard, Glassock, Andrews and Reagan counties of Permian Basin. Rig count has increased noticeably in Glasscock and Andrews counties in West Texas over the last 90 days as both private and public operators ramp Wolfberry programs. The activity in the Wolfberry has recently increased, spurred by the current relatively strong oil prices. The active participants in the Wolfberry play include Berry Petroleum, Linn Energy, Energen and PDC Energy.

PDC Energy is planning a 25-well drilling program in the Wolfberry in 2011 and anticipates continued production growth. Linn Energy’s 2011 capital program of $480 million has two distinct components: high rate-of-return liquids-focused drilling in the Granite Wash and Permian Basin Wolfberry trend and low-risk, low-cost projects. The capital program calls for drilling 45 horizontal Granite Wash wells and more than 130 Wolfberry wells in the Permian Basin.

The Wolfberry Economics

The Wolfberry has moderate rate of return with low risk. The Wolfberry play has gained better interests now than when oil was $147 a barrel in 2008. The 2010 production metrics of Wolfberry play had hit ~$120,000/daily boe as against ~$100,000/daily boe in 2008. 

The economics of the Wolfberry well is as follows: 

• Multiple zones: Spraberry, Wolfcamp, Strawn, Clearfork
• EUR 100-140 MBOE
• Capital Costs: $1.5 - $1.75 million
• IRR: 35% - 70%

Source: PDC Energy-KeyBanc Capital Markets Jan 2011 PPT

Here is the Wolfberry opportunity available for sale! 

Nexen 2011 Investor Roadshow Presentation

http://docsearch.derrickpetroleum.com/pageNav/view1/docId/11182-0000/Nexen_2011_Investor_Roadshow.html

Petrobank March 2011 Corporate Presentation

http://docsearch.derrickpetroleum.com/pageNav/view1/docId/11135-0000/Petrobank_2011_March_Corporate_Presentation.html

Idemitsu Third Quarter Results 2010 Presentation

http://docsearch.derrickpetroleum.com/pageNav/view1/docId/11321-0000/Idemitsu_Presentation_on_Results_for_the_3rd_Quarter_FY_2010.html