On May 6, 2010 SandRidge Energy, Inc. announced the results a test well (the "King Well") of its Western WTO: Warwick Caballos Prospect. The prospect's structure had been previously engineered from 3-D Seismic Data and was estimated by SandRidge to contain approximately 24,000 acres and 5,000' of Gross Thrusted Interval with Unrisked Reserve Potential of 14 TCFe. The SandRidge - Longfellow King 9 #2301 Well was drilled approximately 1,360' East of the Longfellow Ranch border and encountered 904' of gross Warwick Caballos Chert gas pay with a methane gas cut of 78% (analog Pinon Field 20 miles Northwest, gas contains an average 47% methane gas cut across its 15 TCFe of total gas reserves). The top of the Warwick Caballos Chert was encountered at 8,558' in a structurally low position approximately 2,000' Downdip from the crest of the Western WTO Structure and while it contained fractures it was deemed tight due to its structurally low position. SandRidge is currently evaluating future drilling locations nearer the crest of the structure which appears to lie further to the North-Northwest over significantly more of Longfellow Ranch acreage than previously believed.
Public comments from SandRidge Management about the Longfellow - King Well include
"The King Well, when we spud the well we thought that we were on top of the structure and after we drilled down to the point that we thought was the top of the structure we were still in the Pennsylvanian structure so we continued to drill and found the reservoir at a structurally low position. However, the good point was that the reservoir was very thick, which puts us in the upper quartile of the pay in the Pinon Field, and then ultimately the second good thing was that while tight we ran an FMI log and still have fractures. So then lastly, the third good thing is when we tested the well, we saw gas and it was 78% methane, then so that helped us in our belief that as we moved away from the northwest part of the WTO that we would have less CO2"
"So it's very encouraging that we have a majority of methane and that we have the thickness and fracturing and all we need to do is get more up on structure and as we do our re interpretation, it appears that we can move 2,000 feet up dip"
"So part of our model and our interpretation had the potential for two zones of chert in this particular well, and that's why our position on the structure was a little bit further to the south than optimal to be at the crest of the structure trying to encounter the multiple chert packages. As Tom said, the upper portion, a little different than our modeling, was an expanded section of the Pennsylvanian but what was encouraging is that the chert section that we did encounter was nearly twice as much as what typically is found in that region"
"the chert reservoir is very exciting and especially as we look forward to additional wells in that area." (Pennsylvanian Structures in the WTO often consist of Tesnus sandstones.)
The following maps show the approximate geographic location of the SandRidge - Longfellow King 9 #2301 Well and the SandRidge Western WTO: Warwick Prospect as it relates to the Longfellow Ranch acreage that was previously controlled by the 1 LEP Option Agreement covering an undivided 68.75% majority of the Longfellow Ranch fee lands' mineral interests (shaded in yellow). SandRidge has identified other similar prospects on Longfellow Ranch acreage through the results of their 3-D Seismic Program (shaded in green).
It appears from the operator's post-drill assessment and public comments about the King Well that most of the future optimum drilling locations from which to encounter the majority of the structure's pay potential lie further to the North-Northwest on Longfellow Ranch lands where the majority 68.75% undivided interests of the Longfellow Ranch fee minerals are not currently under and oil and gas lease. The attached maps show LEP's interpretation of the Longfellow King Structure based on its review of the drilling results of the SandRidge - Longfellow King 9 #2301 Well and its interpretation of SandRidge's post-drill structure map which puts most of the highs of the structure (shaded in purple) over the Longfellow Ranch. LEP also holds a 68.75% interest in certain 2 Longfellow Ranch Leasehold to the Northwest of the Longfellow - King structure.
In the event a third party is successful in obtaining leasehold rights to the majority interest of the Longfellow Ranch fee mineral acreage (shaded in yellow) then development of the King Prospect could occur under commercially feasible terms. Then as SandRidge states despite the King Structure being 20 miles away from Pinon Field it is still in an area that is very easy to lay pipelines to transport the gas North to existing gas plants for processing and there may be additional options for gas processing and transportation due to the low CO2 cut as well.
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A Memorandum of Option Agreement was filed in Volume 748 pages 153-161 the Deed Records of Pecos County, Texas by LEP and certain mineral owners granting LEP the option to lease approximately 77,878 fee mineral-acres of the Longfellow Ranch Option Lands in December of 2001.
- A Memorandum of Oil and Gas Lease was filed Volume 811 pages 85-98 in the Deed Records of Pecos County, Texas by LEP and certain mineral owners on October 15, 2009 describing these Leased Longfellow Ranch Lands.
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