Oklahoma Sooner Trend
Our assets in Oklahoma have been owned by Alta Mesa for over 20 years and are located in large mature oil fields with multiple pay zones at depths ranging from 2,000 feet to 7,500 feet. The fields were originally developed by Texaco, Exxon and Conoco and are located in the Sooner Trend area of the Anadarko Basin. Wells in this asset group have historically been shallow-decline, long-lived oil wells originally drilled on 80-acre spacing and waterflooded to varying degrees. We have over 40,000 net acres that are mostly held by production contained in the Lincoln North Unit, Hennessey Unit, Lincoln Southeast Unit, and Dover Unit, all located in Kingfisher County.
Low-Risk Opportunities for the Present
We operate over 220 producing wells with an additional 55+ non-operated wells. The rich natural gas produced in this area commands a premium wellhead price. Internally, we have a multi-discipline team of geologist and engineers that are focused on frontier opportunities on our existing acreage including the Mississippi Lime, Oswego Lime, Hunton, and Woodford. Across our acreage we are working on reducing the drilling and completion costs per well thru operating and drilling efficiencies.
The infrastructure in this area is mature and readily expandable. The average working interest in our 240+ wells in Sooner Trend is about 70% with high net revenue interests. We began targeting this field for increased exploitation in 2012 by reactivating or deepening existing wells and drilling new vertical wells. We also began a successful Mississippian Lime horizontal drilling program in 2012 and continued to improve our techniques in this prolific area. Other exploited formations included the Hunton Lime, Oswego and Woodford Shale. We stepped up our development plans in 2013 and 2014 in addition to focusing on reducing the drilling and completion cost for these wells. These fields are made up from a siliceous carbonate and have highly naturally fractured reservoir and geologic systems.
New Frontiers for the Future
We continue to improve our understanding of the impact of water flow on production from our original Oswego and Manning geological zones. Our Sooner Trend Mississippian Lime wells have produced comparatively less water, which we believe is due to the protection afforded by the Chester Shale, which forms a cap over the limestone in this area of Oklahoma. As stewards of the asset and focused on efficiency, we recycle the majority of this disposal water into our waterflood operation, reducing both disposal costs for the newer horizontal wells and water supply costs for the older vertical wells. Production from this area is expected to significantly increase in 2014-15 compared to prior years. This core operating area has substantial growth potential and is expected to provide steady cash flow in the upcoming years.
