Canadian based Jericho Oil Corporation has announced the expansion of more exploration acreage in northeast Oklahoma. The company based in Vancouver says it has signed a letter of intent to acquire a 50% working interest in 2,050 acres and represents another move in the firm’s expansion of acquiring long-lived stripper oil wells in the Cherokee basin in southeast Kansas and northeastern Oklahoma.
The move brings Jericho’s total acreage position to more than 5,800 acres. Doesn’t sound like much, but it falls in line with the company’s goals of focusing on the long-term wells that produce several barrels of oil a day. The latest acquisition, according to a company announcement includes both oil and gas production of approximately 7 barrels of oil equivalent per day.
If it sounds like small peanuts to major oil companies it is, but Allen Wilson, CEO of Jericho Oil explains it this way, “With a strong cash position and no company debt, it is our intention to continue down this path to patiently evaluate leases as they present themselves.”
Further, with the falling price of crude oil, it presents an opportunity for the company.
“The market’s recent turbulence has provided us an opportunity to focus our efforts on acquiring assets with good, long-term development potential at favorable pricing,” added Wilson.
Its current focus is on the Cherokee basin which represents a 15-county region where the leases are located in the two states. The basin in Oklahoma bears the same shallow geological formations of 400 to 900 feet deep as it is in Kansas. Many of the wells were discovered and developed in the early 1900’s. Jericho has targeted Oklahoma has a growth platform as it ranks second in the company’s addressable market with regards to the amount of stripper oil wells.
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