Transaction Pipeline
ONE Energy has several acquisition opportunities under review and welcomes additional submissions. The ideal packages are those that have some level of production (“PDP”) which provides cash flow that the Company uses for working capital and also packages in dividend form to its investors.
ONE Energy looks to enhance the properties it acquires several ways including reducing operating expenditures; utilizing advanced technology; and implementing workover programs and/or secondary recovery programs such as water flooding.
Properties
Below is a listing of the properties ONE Energy currently owns and operates.
The 34 wells are spread across eight leases. The properties
total approximately 1,280 acres. Average depth of the wells is
2,500 feet and the producing formation is Tannehill sandstone.
ONE Energy has set up a program to stimulate the oil and gas
production on the properties and as a result production has more
than doubled over the past nine months.
The Redder Lease was a stressed situation. The lease consists of 14 wells that were drilled over 30 years ago and were producing for many years before becoming neglected. They are shallow at 1,950 feet deep. Part of ONE Energy’s arrangement to obtain the lease was for it to solve some legal problems that the lease owner had with a prior operator. ONE Energy spearheaded the effort and the issue was resolved May 2010. Re-work is expected to begin in August 2010.
The Thompson lease consists of two salt water disposal wells and two producing shut in wells covering approximately 170 acres. The Railroad Commission of Texas was set to plug the wells, however, when the mineral owner found out about the plugging, he contacted ONE Energy to take over operations.
The Hertel Lease consists of four shut in producing wells and one salt water disposal well on 160 acres. Located in close proximity to a 3rd party producing lease, ONE Energy feels that the drilling opportunity and/or recomplete opportunities on the 160 acre lease to be high.
This is the second lease ONE Energy have signed with the mineral owners. A welcomed transfer between the prior operator and us, the lease consists of four shut in producing wells and one salt water well on 250 acres.
ONE Energy holds two acreage only leases. Located in close proximity to our other Hertel Leases, which has wells, ONE Energy feels that the drilling opportunity on the 40 acre lease to be high.
The second acreage only lease ONE Energy holds is for 285 acres with an option to lease additional 590 acres.
*Awaiting Railroad Commission transfer of P-4 on property.
ONE Energy continue to actively look to acquire complimentary leases which are located adjacent to, or nearby, its existing properties, creating an efficient economies of scale.