Brookside Energy Ltd (ASX:BRK) will use US$1.475 million from the sale of acreage within its STACK Play holdings to pursue an aggressive leasing strategy within the world-class Anadarko Basin plays in Oklahoma, USA.
Sale of the RA Minerals Royalty Acreage achieved approximately US$15,300 per acre for a mix of partially developed and undeveloped acreage.
The price per acre represents about 80% of the estimated ‘fully developed’ PV10 value per acre.
This compared to approximately 72% of estimated PV10 value per acre achieved in a previous sale of ‘working interest’ leasehold in STACK.
Brookside managing director David Prentice said: “We are once again very pleased to report the results of a successful acreage sale from within our STACK Play holdings.
“The sale of the RA Minerals Royalty Acreage has provided further validation of our business model.”
Advance SWISH leasing strategy
Proceeds from the sale will enable Brookside to advance its strategy of leasing prospective acreage within the SWISH area of interest of the SCOOP Play.
Prentice said: “The proceeds from this sale can now be re-invested in our ongoing leasing efforts in SWISH where we believe we can create very significant value.
“The investment capital generated from the sale of about 100 acres effectively leverages us into the acquisition of around 1,000 acres.
“We strongly believe that the greatest value for our shareholders comes from acquiring the very best undrilled acreage, unlocking the value as wells get drilled and the reserve potential of each acre becomes apparent.”
SWISH area of interest comprises 35,000 acres
Brookside and its partner Black Mesa, which manages the US operations, are aggressively pursuing a leasing campaign within the 35,000 acres SWISH area of interest.
The partners are targeting an ‘operated position’ of around 8,000 acres within the area that includes at least 10 drilling units, with unit sizes ranging from 320 acres to 1,280 acres.
Brookside Energy leasehold focus areas in the Anadarko Basin plays.
“The model is clearly working, we are very confident as we now continue our work to significantly increase the scale of the business,” Prentice said.
“In our view, Brookside provides shareholders and investors with a unique opportunity to own part of a world-class oil and gas resource play and be rewarded as reserve value is demonstrated and acreage values increase.”
Excellent production rates
The company’s non-operated ‘working interest’ wells in the Anadarko Basin plays continue to deliver excellent initial production rates.
Brookside, which was established in 2004 and listed on the ASX via an IPO in October 2005, is focused on the mid-continent region of the US that is highly prospective for oil and gas.
Its goal is to build value per share through a disciplined portfolio approach to the acquisition and development of producing oil and gas assets, and the leasing and development of acreage opportunities.