Houston-based Epsilon Power Ltd. is forming a three way partnership (JV) targeted on the Garrington and Harmattan areas of Alberta, Canada, within the Western Canadian Sedimentary Basin.
Epsilon stated in a information launch it signed agreements with a “main Calgary-based non-public operator” to kind the JV.
Epsilon will earn a 25 p.c working curiosity in undeveloped lands, masking roughly 30,000 gross acres within the Garrington space, focusing on horizontal growth of the liquids-focused Glauconitic and Ellerslie formations (Mannville), and roughly 130,000 gross acres (majority held by manufacturing) within the Harmattan space, focusing on horizontal growth of the liquids-focused Higher Viking formation, based on the discharge.
- Advertisement -
The corporate estimates that the three way partnership space holds over 25 two-mile places within the Mannville. “The big contiguous Harmattan acreage is extra speculative resulting from assorted historic outcomes however represents a big upside alternative by way of a number of targets and potential completion optimization,” it added.
Epsilon acknowledged that consideration might be within the type of as much as an $8.64 million (CAD 12 million) growth carry, with $7.2 million (CAD 10 million) to be deployed over a minimal of 4 gross horizontal wells (minimal 1.5-mile laterals), drilled and accomplished over a 12-month interval from December 1, 2024, with the operator’s choice for 2 extra gross horizontal wells (minimal 1.5 mile laterals), drilled and accomplished over a 12-month interval from December 1, 2025. The operator will preserve a minimal 20 p.c working curiosity in the course of the carry interval.
In April, Epsilon entered right into a JV within the Killam space of Alberta, within the Western Canadian Sedimentary Basin. In partnership with a special Calgary-based non-public operator, Epsilon acquired a 50 p.c working curiosity in undeveloped lands, masking 14,000 gross acres, focusing on growth of the liquids-focused Mannville formation. Consideration was $1 million (CAD 1.4 million), and the corporate dedicated to take part in two wells throughout 2024.
Epsilon, a Canadian domiciled firm, acknowledged that there are a number of company benefits to establishing a Canadian enterprise. Amongst these are the “substitution of money transfers from Epsilon’s U.S. subsidiaries to the Canadian mum or dad to fund dividends and share repurchases, eradicating the levy of U.S. federal withholding taxes on such transfers”.
Epsilon CEO Jason Stabell stated, “As beforehand communicated, we now have been evaluating potential Canadian tasks during the last yr. We’re excited to announce a brand new venture space in Alberta that matches our strategic focus of drill bit weighted investments with engaging full cycle returns and significant follow-on funding runway (stock). For a small quantity of up-front capital, we are going to set up a 3rd main space to deploy capital in a confirmed hydrocarbon system and greater than double our firm leasehold (after the carry is happy), whereas additionally growing our liquids publicity. With the deal signed this week, we’re partnered with a well-capitalized main non-public participant within the basin. Importantly, this acreage is basically held by manufacturing, affording the power to opportunistically develop these assets as market circumstances warrant”.
Epsilon Power describes itself as a North American onshore-focused unbiased exploration and manufacturing firm engaged within the acquisition, growth, gathering and manufacturing of oil and gasoline reserves. Its main areas of operation are the Marcellus basin in Northeast Pennsylvania and the Central Basin Platform within the Permian basin.
To contact the creator, electronic mail rocky.teodoro@rigzone.com
Generated by readers, the feedback included herein don’t replicate the views and opinions of Rigzone. All feedback are topic to editorial evaluation. Off-topic, inappropriate or insulting feedback might be eliminated.
