Permian Basin Yields Success for Cross Border
Cross Border Resources (OTCQX: XBOR)continues to successfully execute its drilling program in the Permian Basin, as evidenced by recent news.
On March 15, the Texas-based oil and gas exploration company issued an operations update on its recent drilling activity. The Company announced significant production adds from three wells that recently went online (Cimarex SE Lusk 33 #2H and #3H, and Mewbourne Zircon 2 #1H). These, along with other drilling activities undertaken by XBOR and its operating partners, have significantly increased daily production and cash flow to the Company.
The following day, XBOR announced its financial and operating results for fiscal 2011, its first full year of operations as Cross Border following the merger of Doral Energy Corp. and Pure Energy Group in January 2011. Revenues increased 92.0% year-over-year to $7.3 million, and production volume grew 27.6% year-over-year to 98,855 barrels of oil equivalent (boe). Average daily production for the year ended December 31, 2011 was 271 boe compared to 212 boe in 2010. The increases were due in part to the merger but also to increased production from wells added year-over-year.
Cross Border plans to participate in at least 25 gross wells in 2012 and expects to exit the year with an average production rate of 750 boe per day, a 50% increase from its January 2012 exit rate. The Company will focus primarily on its 2nd Bone Spring acreage in New Mexico, participating in seven gross wells with an average working interest of around 15%. A replay of XBOR’s March 16 earnings call is available on the Events and Webcasts section of the Company’s website.
The Permian Basin remains a highly prolific oil and gas region, producing 17% of total U.S. crude oil. By partnering with leading operators such as Apache (NYSE: APA) and Concho Resources (NYSE: CXO), XBOR is well positioned to capitalize upon its strong acreage portfolio in the Permian Basin. You can learn why RedChip analysts rate XBOR a Strong Buy by downloading our initial report on the Company.
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