TXO Partners, L.P. has announced a significant potential for natural gas production in the Mancos shale of the San Juan Basin. The company revealed that it holds a 58,500 contiguous-acre position in the area, with a target of nearly 3 trillion cubic feet equivalent (TCFE) of natural gas potential. This represents a substantial increase, as the company believes it could be as much as five times its current total reserve base on an oil equivalent basis.
The company's president of production and development, Gary D. Simpson, highlighted a specific 3,520-acre block identified as phase I for developing and monetizing reserves, representing about 6% of the current Mancos position. This block is estimated to hold about 200 to 300 billion cubic feet (BCF) of natural gas with 25 billion cubic feet equivalent (BCFE) estimated per drill well, potentially doubling the existing natural gas reserves.
In addition to the specific phase I project, the company emphasized that the ongoing cash flow from all activities will be allocated to capital investment decisions, unit distributions, and debt management, indicating a strategic approach to managing the potential influx of resources.
Following these announcements, the company's shares moved 3.9%, and are now trading at a price of $18.62. For the full picture, make sure to review TXO's 8-K report.
