2.000 net acres/Up to 50 horizontal wells possible
Heidelberg/Denver. Cub Creek Energy (CCE), oil and gas subsidiary of Deutsche Rohstoff AG, has entered into a Joint Development Agreement with a private oil and gas producer within the core area of the Wattenberg field in Colorado. The prospective area is approximately 2,000 acres and Cub Creek Energy will be the designated operator of the project.
The size of these newly acquired leases corresponds to the portion of the area successfully sold in May 2014, which Deutsche Rohstoff’s subsidiary Tekton Energy previously developed with several wells.
The management of Cub Creek forecasts the possibility to drill up to 50 horizontal wells within the next three years in this new area. Cub Creek will begin the well permitting process immediately which will eventually define the precise number of wells possible for execution. In January, Cub Creek acquired leases near this new acreage position, where up to 12 horizontal wells are being prepared at the moment. Cub Creek will develop all of these areas as the operator.
Thomas Gutschlag, CEO of Deutsche Rohstoff, said: „With this acquisition as well as the areas of our second US-subsidiary, Elster Oil and Gas, we have an equally attractive portfolio as the former Tekton Energy. Thanks to lower oil prices we were able to secure all these areas under favorable business terms.”
Due to its technical studies, the management of CCE expects these areas to be economically attractive from a WTI oil price of about USD 40. The management also assumes a significant reduction in drilling costs due to the sharp decrease of oil prices.
In the Magpie project area, Elster Oil and Gas will participate in five wells as a 50% non-operator that will begin operations in April 2015. These wells are currently forecast for production in September 2015. The pace of development and production availability of these wells is subject to change based on the oil price environment.
Cub Creek Energy, based in Denver/Colorado, was founded as successor of Tekton Energy in June 2014. Deutsche Rohstoff currently holds a stake of 74%. Tekton Energy (now Elster Oil and Gas), which was founded by Deutsche Rohstoff in 2011, sold their main assets in the same field, only a few miles further north, for USD 200 million in May 2014. Elster still holds about 50% interest in an area called Magpie (approximately 700 acres), which is also located close to the newly acquired area.
Heidelberg, 23 March 2015
Deutsche Rohstoff (Heidelberg, Germany), listed in the Entry Standard segment of Frankfurt Stock Exchange, is establishing a new primary producer. The company’s focus is placed on oil & gas and so called high tech metals such as tin, tungsten, and rare earth metals. All projects are located in political stable countries with high environmental standards. The business concept is based on redeveloping deposits, which have been well explored in the past. For more information please visit www.rohstoff.de.