Heartland Group and Barron Petroleum form joint venture
The Heartland Group Ventures (Heartland), a Fort Worth based oil and gas investment company, has entered into a material definitive agreement with its joint venture partner, Barron Petroleum (Barron) for a joint drilling venture in the newly discovered natural gas fields in Val Verde County, in Texas.
In a statement, the companies say that pursuant to the agreement, they have completed the all-cash purchase of two additional and contiguous natural gas leases and options in an undisclosed area of the county, including shallow and deep drilling rights. These will be added to their existing assets in the region, the statement adds.
“The first lease was assigned to Heartland and Barron in September 2020, and the second lease was assigned in October 2020, bringing their total acreage in the area to 24,200 acres. These acquisitions were completed following the venture's recent discovery of a new field containing in excess of 417 billion cubic feet of natural gas,” the statement continues.
As per the terms of the venture, Heartland and Barron will utilise their jointly held drilling assets and will equally share the costs associated with the drilling and completion of deep and shallow vertical wells. Furthermore, they jointly own the propriety 3D seismic data on the leased properties, the statement confirms.
Drilling and completion is anticipated to begin in the November-December 2020 timeframe, and planning for the project is already underway, the companies say.
"We are excited to continue to grow our natural gas asset base in the region and further build our joint venture relationship with Barron Petroleum," says Rustin Brunson, Heartland's Fund Manager.
"Our recent discovery with Barron has given us the opportunity to build our natural gas asset portfolio in a substantial and cost-effective manner.
"Like others in the industry, we are closely watching markets and tailoring our long and short-term strategies accordingly. We believe these acquisitions will go a long way toward building an energy asset portfolio with long-term viability and cost-effective operations,” he adds.
In August, Barron announced a major new discovery in the Permian Basin in Val Verde Country. In a statement released at the time, the company says that the 13,000-acre field is estimated to hold 417 billion cubic feet – or 74.2 million barrels in oil and gas reserves.
Barron presently holds development rights to over 13,000 acres over the prospect, which was developed with the use of a 3D seismic survey. The company has identified 67 high-graded Strawn formation locations and is refining future location placement based on results of the first well.
Barron Petroleum is also contemplating testing and potential development in the Canyon formation at an approximate depth of 9,000 feet and Ellenburger at about 16,000 feet depth, the statement adds.