Palo Duro Resource Play Joint Venture
The Palo Duro Basin is located in the Panhandle of Texas just north of the prolific Permian Basin and covers 22,700 square miles. It is surrounded by other well-known and productive basins i.e. Anadarko Basin, Midland Basin and the Amarillo-Wichita Basin to the north. The Palo Duro basin is connected to the Permian Basin by the Permian sea. The rocks in both basins are the same age and very similar in composition. Currently over one-third of the North American drilling rig fleet is working in the Permian Basin.
Escopeta Oil and Gas, our partner, began to reassess the Palo Duro’s petroleum potential two years ago. Escopeta began to (1) collect drilling and completion data, (2) acquire the available drilling logs in the basin, (3) and conduct special studies. Escopeta obtained these logs and selected NuTech Energy Alliance to evaluate logs from 21 different wells in the Palo Duro based on actual core samples from the Wolfcamp and Atoka formations.
It should be noted that right after Escopeta started this research and a leasing program eventually leasing 275,000 acres, Anschutz Exploration, Laredo Energy, Four Sevens Exploration and Gordy Oil all began aggressive leasing programs.
Additionally, NuTech performed log analysis on 24 wells in the Palo Duro Basin; correlated with 10,000 wells in the Midland Basin’s Wolfberry play to the south. There are striking similarities between the Wolfcamp Shale in the Palo Duro Basin vs. the Wolfcamp Shale in the Midland Basin. Depth of the sand, porosity, pressure gradients and reserve estimates of 430 MBOE per well were all very similar.
Noted Certified Petroleum Geologist, Walter D. Wells was retained by Escopeta to evaluate all of the scientific data available to support the Palo Duro #1 well. A summary of his findings are as follows:
- Note the core analysis essentially confirms the log analysis of productive zones.
- The NuTech log is confirmed by the cored oil and by production from the Lower Wolfcamp in the Bankers Petroleum Jones #1 well. This is dispositive proof of sourced and moveable oil within the Wolfcamp which is consistent with Escopeta’s Basin model.
- Lastly, note that the # 1 Jones well and the #1 Stephens are productive from the Atoka.
- Summation: It is now apparent that an extensive, discrete petroleum system exists within the deep Palo Duro Basin – Lower Wolfcamp and Upper Penn Atoka are both source and reservoir.
UPDATE The southern Louisiana prospect, West Delta Farms #5 well, has settled into production rates of about 60 barrels of oil and 300 MCF of natural gas per day.
UPDATE The Jal Northeast Prospect is completely funded. The well will drill in early fall.
UPDATE The Perryton Joint Venture, Pope 4H well, has drilled to total depth. We are waiting on a rig to begin completion work. (see pics below)
UPDATE The Palo Duro Resource JV is completely funded. Surface preparations for the well site are underway. We expect a rig to be on site around November 1st.
Perryton Prospect Pics