Oklahoma wells to bring hefty revenue stream to Foothills Petroleum

Feb. 13 (UPI) -- U.S. oil and gas company Foothills Exploration said Monday the revenue stream from newly-acquired wells in Oklahoma should be more than half what it made during the first half of 2022.

Spread out across four lease areas, Foothills said it closed on the acquisition of 21 oil and natural gas wells in southwestern Oklahoma for undisclosed terms.

Oklahoma is home to the Anadarko shale basin, a mid-tier producer of oil and natural gas. The federal government reported that Oklahoma in 2021 had the largest net decrease in proved reserves of crude oil and condensate, an ultra-light type of oil found in many shale deposits.

Oil production for February should be around 442,000 barrels per day at Anadarko, compared to the 5.6 million bpd expected from the Permian basin, the largest inland oil producer in the country.

Foothills said it was targeting the Granite Wash basin, a reserve located within the broader Anadarko shale. Production should be sparse, but relatively profitable for the company.

"Based on baseline projections and $75 oil prices, the company expects to generate approximate revenues of $432,000 (after royalties but before field expenses) from these properties over the next 12 months," the company stated.

West Texas Intermediate, the U.S. benchmark for the price of oil, was trading at around $79 per barrel early in the Monday session.

That's a significant revenue stream for a company that reported only $739,000 in gross revenues over the six-month period ending June 30. During the same period in 2021, Foothills realized gross revenue of only $262,000.

Oklahoma has five refineries with a combined processing capacity of 522,000 barrels per day, accounting for about 3% of total U.S. refining capacity. As of 2020, it held about 4% of the nation's total proven crude oil reserves.

Similar to recent seismic activity in and around the Permian basin in Texas, Oklahoma witnessed regular, but minor, earthquakes several years ago that were tied to oil and gas exploration and production.