~$435,000/mn net cash flow – Operated

Property for Sale

Property Information

  • Bid Date: May 16, 2018
  • Effective Date: April 01, 2018
  • Closing Date: June 29, 2018
  • Area Size: ~9,530 Net & ~13,740 Gross acre
  • Type of Basin: Arkoma Basin

Executive Summary

Eagle River Holdings, LLC has been exclusively retained by Vanguard Natural Resources, Inc. (“Seller”) for the divestiture of operated working interest assets, associated development rights and midstream assets located in the Potato Hills Field of the Greater Arkoma Basin of Latimer and Pushmataha Counties, Oklahoma.

Property Description

Producing Assets with Stabilized Cash Flow

  • ~5,500 Mcf/d net production (100% Gas)
  • ~$435,000/mn net cash flow (6-mo average) from upstream assets and operated gas gathering system
  • Mature conventional production, driven by pressure depletion, provides low declining and predictable cash flow
  • Legacy infrastructure provides long-term economic operation of field

Operated Position in the Greater Arkoma Basin

  • 48 gross wellbores with average of 71.9% WI / 57.1% NRI
  • ~9,530 net and ~13,740 gross acres majority operated leasehold (100% HBP)
  • Potato Hills field produces dry gas from the late Mississippian – early Pennsylvanian deep water Jackfork sands
  • Asset primarily produces from the Ratcliff with cumulative production of over 10 Bcf each in multiple wells

Engineered Reserves

  • ~27.2 Bcf PDP net Reserves
  • ~1.6 Bcf Behind Pipe net Reserves from 8 wells with identified recompletion potential with IRRs in excess of ~60%
  • 3 recompletions performed in December 2017 in the Cedar Creek and Ratcliff formations and comingled with current zone yield encouraging recompletion economics

Operated Gas Gathering System

  • Operated Potato Hills Gas Gathering System for sale and bids to be considered separate from upstream assets
  • Vanguard and Continuum jointly own 100% of gathering system and each is selling its interest in the system
  • ~$81,000/mn net cash flow from ~10,500 Mcf/d gross current through put at a gathering fee of $0.35/Mcf
  • ~43 miles of existing steel pipeline gathering entire Potato Hills field

Contact Property Agent

Contact Form