As a stampede of oil and gas exploration and development companies race toward the prize of higher oil and gas prices, the legwork needed to efficiently capitalize is often lost to the lure of a quick strike. Exploration and development of past and future oil and gas prospects takes time, research and money. The temptation of a quick score is huge, but finding an oil and gas company that has done their homework is the key to long-term profit in a fast-paced and changing natural resources market.
SunCal Energy Inc., an oil and gas exploration and development company, works to discover, rework and extract oil and gas deposits in California, Wyoming, Texas, Oklahoma and Louisiana. The company is primarily involved with operations located adjacent to existing or closed development sites once owned and operated by ExxonMobil Chevron and Conoco Phillips, et al.
The company has been having solid results at its West Pecos, TX – West Gomez Field–Sibley 84#1 well as reentry and tie-in have been completed. The well is currently producing 4 million cfd of gas and a solid flow of revenue for the company. Concurrently, infrastructure for the company’s new Sibley 84#2 well has been completed and drilling begun for additional production in the very near future.
The West Gomez field has a long and predictable history that the company is planning to exploit fully. Geological reports estimate that 27 bcf of gas and 50,000 barrels of oil are recoverable at the site, making the company’s 2% stake a revenue-positive situation in almost any scenario.
The company’s second producing region, located in Hobart OK, is also contributing significantly to revenues. The prospect comprises approximately 1,200 acres and is located at one of the country’s largest mid-continent gas-producing regions. SunCal’s 1.5% overriding royalty interest in the prospect, drilled by Marathon Oil, might be considered a nice long-term cash cow for the company.
Generally speaking, the company is in a very solid position at the moment, regardless of what commodity gas and oil prices decide to do over the coming months and years. It is producing a nice stream of revenue and appears to have remarkable in-ground reserves waiting to be tapped in Wyoming, California and Louisiana. The capital required to tap these potential reserves will certainly be available from continuing operations. Although it may be pure conjecture, it does appear that SunCal’s boys from Alberta have done their homework and are profiting by it.
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