Lilis Energy, Inc. (OTCQB: LLEX) operates as an independent oil & natural gas company. The company engages in acquisition, drilling, and production of oil & gas in the United States. Shares of Lilis Energy, Inc. are rallying 10.62%, through early trading on Friday, October 14, 2016. Over the past month, Lilis Energy, Inc. has seen average daily volume of 95,400 shares. However, nearly 81,000 shares or dollar volume of $288,360, has already exchanged hands through early trading Friday.
Shares of Lilis Energy, Inc. are rallying Friday, after the company announced they had purchased more oil & gas properties in the Delaware Basin. The Delaware Basin is located in Winkler County, Texas, and the assets were purchased from another oil & gas company that is currently in bankruptcy court. Lilis Energy, Inc. purchased the additional assets for $3 million and now expands the company’s Delaware Basin acreage to 4,433. Here is the press release detailing of the asset purchase:
Lilis Energy, Inc. Press Release:
DENVER, Oct. 13, 2016 /PRNewswire/ — Lilis Energy, Inc. (“Lilis” or the “Company”) (LLEX) today reported that it has acquired certain oil and gas properties located in Winkler County, Texas, for a purchase price of $3 million (the “Properties”). The Company purchased the Properties through a sale process under Section 363 of the Bankruptcy Code. The Properties represent a 12% increase in its net Delaware Basin leashold. The Company’s net acreage in the Delaware Basin is now approximately 4,433 net acres, which represents a 28% increase since June 2016.
The Properties, which offset the Company’s existing acreage position in the highly productive Delaware Basin, consist of 500 net acres and includes a 78% working interest in a producing vertical well. The well holds the lease to all depths, from surface down to 22,000 feet, including the Wolfcamp, Bone Springs, and Avalon formations. The vertical well currently produces approximately 690 net mcf per day and has estimated PV-10 PDP value of approximately $3.5 million, using current commodity prices. The Company has not yet estimated reserve potential for any further horizontal development.
“We are thrilled to have closed on this bolt-on acquisition out of bankruptcy. Through existing relationships in the field, combined with an operating presence, we have demonstrated a highly competitive advantage in securing offsetting acreage at a discount relative to surrounding basin activity,” said Avi Mirman, CEO of Lilis Energy. “Essentially, we acquired a well at a discount to its PV-10 PDP value, and as a bonus, secured 500 net acres in the Delaware Basin that are held by production. We will continue to utilize our strong cash position in a prudent manner, through a mix of further leasehold acquisition and drilling activity.”
The Company today also provided an update on the drilling of its first Wolfcamp lateral, the Bison #1H. The successful kick-out from the vertical casing went as engineered. The horizontal portion is currently being drilled and is a planned 6,000 foot lateral. Upon reaching total depth, the rig will move to drill the next Wolfcamp location, the Grizzly #1H.
The Company plans to announce its expected capital budget and drilling program in the upcoming weeks.
About Lilis Energy, Inc.
Lilis Energy, Inc. is a Denver-based independent oil and gas exploration and production company that operates in the Permian’s Delaware Basin and in the Denver-Julesburg (DJ) Basin, considered amongst the leading resource plays in North America. Lilis’s total Permian Basin acreage is 10,870 gross acres / 4,433 net acres, 92% HBP, and total net acreage in the DJ is approximately 7,200 acres. Lilis Energy’s near-term E&P focus is to grow current reserves and production, and pursue strategic acquisitions in its core areas.