Corterra’s projected big gas play leads to sale two years later

Two years after Tulsa-based Corterra Energy declared “All signs point to GAS” and stated that Oklahoma’s Arkoma basin and Hughes county were a “hotbed of activity,” the company is trying to sell part or all of its operations in the very region.

Corterra has put up for sale its oil and natural gas/liquids producing properties and other assets in Hughes, Coal and Pittsburg Counties. It spent $68 million in 2017 in acquiring 26,000 acres and interest in more than 400 producing wells from Continental Resources.

The company hasn’t publicly put a price tag on the assets. But Houston-based Detring Energy Advisors, the firm handling the sale, stated that the sale includes the annual current operational cash flow of about $9 million from the assets. The assets includes 241 wells of which 100 are operated by Corterra.

Detring Energy’s website described the Corterra listing this way:

Liquids-Rich Arkoma Leasehold Opportunity

  • ~65,600 net acres (~55% operated / ~65% HBP)
  • Substantial net operating cash flow (~$9MM NTM) & production (~24 MMcfed, 24% Liquids)
  • >1,100 horizontal Woodford locations identified across the position
  • Completed seismic interpretation, petrophysical analysis, core studies, and detailed geologic mapping high-grade the Woodford and Mayes drilling potential
  • Bids due February 19, 2020

What is not clear is whether the sale will bring an end to Corterra Energy, a firm founded in 2016 and led by CEO Valerie Mitchell. White Deer Energy, a private equity investor backs the firm.

Mitchell was also named last summer to the Board of Directors of NCS Multistage Holdings,Inc. based in Houston. Before founding Corterra Energy, she was Vice President, Mid-Continent at Newfield Exploration Company. She also held other Mid-Continent positions including Vice President of the firm’s Corporate Development and its General Manager.

At the time of Corterra’s investment in Southeast Oklahoma, the company considered the Arkoma Basin to be the next STACK and SCOOP-like play in the state.

Even the Enverus Blog put it in that category as it wrote of Corterra’s acquisition.

“According to recent activity, the Arkoma Basin appears to be the next big hotspot in Oklahoma, with the majority of leasing and permitting centered around Hughes County. There have been a total of 4,154 instruments recorded in the last 180 days centered around Hughes County, which represents an average royalty interest of ~19.1%. Along with Continental’s large sale last month to Corterra Energy, several E&Ps have taken acreage in the last 180 days in the Arkoma including Arkoma Energy, Calyx Energy, Continental Resources, and Silver Creek O&G, to name a few .
While the SCOOP and STACK trends have cooled down in recent months, activity in the Arkoma has continued to increase.”

 

 

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