Lucas Energy, Inc. (NYSEMKT:LEI) updated on its operational progress in the Eagle Ford shale and advancement activity in Oklahoma. Specifically, in the Eagle Ford shale, the firm partook in the Cyclone #9H well that projected 598 Boe/d and a 30-day preliminary production rate of 486 Boe/d. In addition, the Cyclone #10H gauged 631 Boe/d and a 30-day preliminary production rate moving at 521 Boe/d. Originally predicted to cost around $5.2 million, these wells are drilled and completed for average cost of $4.7 million. Both wells are producing nearly 90% crude oil from a managed 3-stream basis. Lucas has an 8% working stake in these wells.
Lucas has kicked off an upgrade and maintenance plan of $0.5 million to be spent in the next 60 days with the projection of a 5-month payout on the mentioned investment. In Oklahoma, the plan includes the replacement and/or repair of down-hole pumps besides mechanical upgrades and repairs on certain wells in Texas. The company projects to continue these maintenance initiatives as it assesses the new well drilling sites in its core areas of advancement.
Anthony C. Schnur, the CEO of Lucas, said that since the Segundo deal was reported last December, the prices for natural gas, NGLs and oil have surged on average by more than 40%. The variation in the commodity price environment has enabled Lucas to reevaluate its prospects to improve shareholder value. As the company increases production on newly-acquired and legacy assets, the firm persists to aggressively look for acquisition prospects with both nonproducing and producing reserves. The company is confident that the ‘lower for longer’ state of commodity price environment provides exceptional value on the acquisition front.
Lucas is primarily engaged in the development and also acquisition of natural gas and crude oil from different known productive geological establishments, including the Eagle Ford Shale and Austin Chalk in South Texas, and Hunton Formation in Central Oklahoma. The management team is dedicated to establishing a platform for advancement and growth of its gas and oil reserves while putting its focus on cost control and operating efficiencies.