Mexco Energy is buying working interests in the 160 gross acres in the Fuhrman-Mascho Field of Andrews County, Texas, for an estimated purchase value of $670,000.
The Company has financed the cash purchase price initially from its $5.0 million credit facility and the remaining from working resources.
This land has four wells, in which three are producing from the San Andres and one newly drilled well from the Grayburg and San Andres structures at a depth of around 5,000 feet. Cone and Petree Oil & Gas Exploration are operating these wells. Mexco possess working interests of around 10.8% in this property.
Extra 11 potential drill locations in the Grayburg and San Andres structures, along with more intense spacing of around 10 acres per well are included in this property. This new spacing will increase the production in the Fuhrman-Mascho Field.
At present, this field has 2,400 producing wells. So far, the combined production from the field is about 122 million barrels of oil and 122 billion cubic feet of gas.
This acquisition by the company has signified a valuable addition of long-lasting oil reserves with future development drilling sites enclosed by yielding oil wells.