Parallel expands stake in West Texas Fullerton field

Ray Tyson

Independent producer Parallel Petroleum has purchased an additional interest in the Lineberry and Grogan leases in the Fullerton field of Andrews County in the Permian basin of West Texas for $5.63 million, the company said Oct. 8.

The additional interest was acquired from Kaiser-Francis Oil Co., Parallel said, adding it financed the acquisition using a portion of its revolving credit. The effective date of the acquisition was Sept. 1. Parallel recently purchased $15.3 million of Fullerton properties from Chevron U.S.A.

The Lineberry and Grogan leases cover about 720 contiguous gross acres and consist of 21 gross producing oil and gas wells that produce from the San Andres formation at a depth of about 4,800 feet. The recent acquisition increased Parallel’s working and net revenue interests in the two leases from an average 35.3 percent working and 26.3 percent net revenue interest to an average 76.5 percent working and 58.9 percent net revenue interest.

The additional interest represents an estimated 540,000 barrels of proved oil equivalent reserves net to Parallel, 73 percent of which is proved developed producing reserves.

Since December 2002, Parallel has acquired about 11.65 million barrels of proved equivalent oil reserves for an estimated total combined acquisition price of $67 million.