Skip to content

Zephyr Energy Adds to its Utah Acreage

Read Time: 3 mins

Rocky Mountain-focused Zephyr Energy says it has increased its operated land position through the acquisition of an additional 1,920 acres in Utah’s Paradox Basin.

The AIM-traded firm said the new acreage was directly contiguous to its operated White Sands Unit (WSU), with the potential to be added to the unit’s acreage subject to approval from the US Bureau of Land Management (BLM).

It said the acreage was largely covered by its existing 3D seismic, and directly bordered the lease on which the planned State 36-2 LNW-CC and 36-3 LN-C9 well pad was located.

The new acreage was also close to pre-existing surface infrastructure in the form of a six-inch gas pipeline, which traverses the leasehold.

Zephyr pointed to “immediate” drilling benefits, explaining that by adding the new acreage, the lateral for the proposed State 36-2 LNW-CC could be fully completed across a 10,000-foot length, subject to final regulatory approval.

That is expected to further enhance the well’s forecast economics and estimated ultimate recovery.

In conjunction with the acquisition, Zephyr says it amended its BLM application for a permit to drill for the State 36-2 LNW-CC well, to reflect the enhanced completion design, with approval expected shortly.

Based on modelling results of the recently drilled State 16-2LN-CC well, modelling for the upcoming State 36-2 LNW-CC well, and production data from the nearby vertical Federal 28-11 well, Zephyr’s technical team estimated that the acquisition added more than four million barrels of oil equivalent of additional 2C net contingent resources to its Paradox Basin position.

The acquisition “substantially” increased the company’s working interest in an estimated four Cane Creek reservoir well locations, adding an estimated 2.4 net wells, assuming two-mile lateral well lengths.

It also added unrisked net present value at a 10 percent discount, net to Zephyr, of around $40m from the Cane Creek reservoir, based on estimated economics for two-mile laterals.

That estimate assumed success case outcomes from State 16-2 LN-CC flow testing and State 36-2 LNW-CC drilling and testing.

The company also says that it delivered access to acreage that could host liquid yields like that observed at the nearby vertical Federal 28-11 well, and higher than those at the recently tested State 16-2 LNW-CC well.

Finally, Zephyr said it would provide additional potential in the overlying shallow clastic zones.

Colin Harrington, chief executive officer, said: “Our team has been working flat out to deliver substantive value from our Paradox project during a globally challenging period of supply chain conditions.

“We’ve often compared this type of development process to a jigsaw puzzle, and another important piece has been connected through the acquisition of the new acreage.

“This prime acreage, already located under Zephyr’s 3D seismic, adds valuable locations and resources, and just as importantly, it secures an immediate win by providing the opportunity to drill and complete a longer and more effective delineation/development well.”

Mr Harrington said the company expected a “corresponding beneficial impact” on the well’s production potential, and its estimated ultimate recovery.

He continued: “With the new acreage secured, we plan to spud the State 36-2 LNW-CC as soon as final permits are received and a rig contract is secured.

“We will be providing a full update on the proposed drilling programme once the final permits have been issued.”

For more information visit