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In partnership with Orchard Petroleum, Nuenco has upped its working interest to 50% in the South East Lost Hills, which covers 5000 acres under lease from Aera, from the Nahabedian Exploration Group. The acquisition includes five wells at Jack Hamar, in which Orchard will take over operatorship of the project.
Nuenco and Orchard will also acquire 50% more acreage, or 1,280 acres, to the northwest and east of the Lost Hills.
In addition, Nuenco has farmed-in to more than 2200 acres to the immediate north and east of its current acreage, where similar play types to the Jack Hamar discoveries have been identified, the company said. The Ivanhoe Energy farm-out will see Nuenco drill wells on a promoted basis to earn a 25% working interest in the new project.
Nuenco has also acquired a 15% working interest from Orchard Petroleum in the shallow rights to a new prospect to the east of South East Lost Hills, called South Buttonwillow. It also has the option of a 15% working interest in the deep rights, where a possible Stevens Sands play has been mapped but never drilled, Nuenco said.
The company said it had secured the funding for these acquisitions by raising a $4.88 million convertible note financing with Aton Select Fund Ltd – a European Investment group with significant exposure to the hydrocarbon sector.
Managing director Anthony Kain said the transactions added material upside to Nuenco’s Californian portfolio, meaning it could now leverage off its 100% drilling success rate to chase similar exploration play types.
“This is an important acquisition for Nuenco as acquiring interests in oil and gas exploration properties in the USA and California has become very competitive,” Kain said.
“The board believes the price paid is low considering the proven geological basin, existing well success rate and the prospectivity of the area.”
The company has also appointed Greg Lee, an engineer with 27 years experience in oil and gas development, engineering and drilling operations, to the Nuenco board (see today's Personnel Movements story).
