Ring Energy, Inc. has signed a purchase and sale agreement to acquire producing wells and leaseholds located in Culberson and Reeves Counties, Texas.
The property consists of approximately 14,000 net acres. Ring will be the operator and have an approximate 98% working interest and average net revenue interest in excess of 78%. The acreage is located in the Delaware Basin.
The current net daily production to the Company from the properties is approximately 1,300 Boe/d, which is approximately 80% oil. The Company's initial proved developed producing reserve estimates, as determined by outside independent engineering firm Cawley, Gillespie and Associates, are an estimated 4.7 million BOEs net to Ring, with a PV-10 value of approximately $128.5 million. The report was completed at year-end 2014 using average pricing of $90.24 per barrel of oil and $4.64 per MCF of gas. In addition, Company internal engineering is currently evaluating additional proved undeveloped, probable and possible opportunities and will disclose their findings in a future release shortly after the closing date.