Today, RainChief Energy, the Vancouver-based energy developer currently focused on the Gulf Jensen Oil Prospect in New Mexico Permian Basin, reported successfully executing an agreement with Calgary-based Nueva Oil & Gas Corp. for a farm-in interest in the Gulf Jensen.
This marks a key move for RainChief as the company completes one essential aspect of the overall strategy for the Gulf Jensen, a geographically-choice oil property in Curry County, NM, with access to the northwest section of the Permian (responsible for some 17% of domestic crude production). The Gulf Jensen Prospect is comprised of 2,044 acres of oil/gas leases proximal to the #1 Jensen well, upon which RainChief originally conducted extensive engineering analysis of open-hole log data, prompting the company to pursue the farm-in.
CEO of RCFEF, Paul Heney, explained that the company sees this property identified by the Calgary-based Nueva (run by Norman Mackenzie, founder of C&C Energia Ltd.) as being very high-quality. Open-hole electric log data analysis from the #1 Jensen is being used as the rationale for projected offset well drilling, and overall analysis offers a clear view that the Gulf Jensen is a good geographic analogy to extant producing Permian hydrocarbon structures/layouts.
The neighboring Peterson Oil Field has shown production rates in the range 492 barrels per day (with 193 barrels of reef oil trap formation water), with recovery on a per-well basis around 230k barrels and 1B cubic feet of gas. This superb production profile via analog to the Peterson Oil Field indicates that the Gulf Jensen Prospect's oil and natural gas equivalent contents could indeed be quite significant. Shale gas production looks feasible and indications of such are slated for review, as the high organic content of local wells suggested by analysis of log data makes commercial shale gas development a prime target.
The company intends to evaluate the potential of shale gas development in the first farm-in well and RCFEF is confident that the commercial potential of the shale could result in a multi-fold jump in the Gulf Jensen's value. If the analog is correct, the Gulf Jensen acreage could support as much as 3M barrels of oil and natural gas equivalent. An exploration program of seismic analysis and test drilling could follow preliminary validations, resulting in an even bigger operation for RCFEF in New Mexico.
Keenly reviewing local offerings, RainChief is intent on continuing to review additional resource properties that mix the best of short-term and long-term potential and the NM portion of the Permian alone holds three of the biggest domestic oil fields. Based on current oil prices, which look to have a strong future as price-critical throughput factors in the Middle East continue to hammer home the idea that domestic production is sound on many levels, the historical volume of the Permian Basin would be in the ballpark of around $2T (some 20B barrels since 1921). That's a pretty nice park to be playing in and RainChief is laser-focused on carving out a slice of the Permian pie, whose proven reserves are second only to Alaska (and let's face it, NM/TX is easier to logistically operate in).
Despite flagging growth in China and a flattening price trend, global energy demand from a variety of existing and emerging areas continues to roar as the entire planet thrives on abundant, affordable sources, with North America evolving into an again, increasingly-dominant provider.
For more information on the Gulf Jensen farm-in announcement, or to stay up to date with the latest news and developments at RainChief Energy Inc., please visit the company's website at RainChief.com
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