Expected start of production early 2020/USD 60 million investment
Mannheim/Denver. As announced earlier this year, Cub Creek Energy has started an extensive drilling program on the company’s sites in Colorado. The program consists of 11 2-mile horizontal wells from the Olander drilling site. The costs are expected to amount to USD 60 million, of which Cub Creek will bear most. Cub Creek holds a 93% interest in these wells. Production of oil and gas is expected to begin in early 2020.
With an average oil price of USD 54 per barrel over the life of the well, Cub Creek’s management expects an Internal Rate of Return (IRR) of 20-42%. The low value applies to the so-called base case with conservative assumptions regarding production rates. The higher value would be realized in the case of a production that is 20% above the base case.
Mannheim, 24 June 2019
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