Zeppelins buys Alberta leases

Petroleum News

Zeppelin Energy Inc. has acquired an interest in oil and gas leases in the Drayton Valley area in west central Alberta, the company said April 26. Zeppelin signed a farm-in agreement with Ribstone Resources Ltd. for the acquisition, which is subject to a 3 percent gross overriding royalty. The company would get a 90 percent interest in about 1,120 acres and a 30 percent interest in 480 additional acres. Zeppelin plans to move right away, spudding its first well by mid-July. A minimum of three wells are required to fully earn the Ribstone interest, with costs expected to run C$300,000 per well. A series of cash payments totaling C$283,333 will complete the deal.

Zeppelin also has an option on Ribstone interests in 800 acres in the Pembina field, down to the producing Cardium formation there. Wells drilled in that area during Pembina’s development encountered productive sands that weren’t exploited as drillers were making their way to the Cardium layer. If the option is exercised, Zeppelin would get 90 percent of the Ribstone rights. Ribstone has a 70 percent interest, with Devon Energy holding the rest.