Rosehill Resources Inc. (ticker: ROSE) expects to drill 16 to 22 new wells in the White Wolf area in 2018 and expects to complete 12 to 16 of those wells. While most of these wells will have lateral lengths of approximately 5,000 feet, the company is projecting four to eight extended lateral wells greater than 7,000 feet in 2018.
Rosehill did not acquire any additional acreage under the White Wolf purchase agreement. Rosehill’s total acreage position in this area stands at 6,505 net acres. The company is surveying, staking and permitting the first four White Wolf well locations, with the first well expected to spud in April, with early well results expected this summer. All four initial wells will target the Wolfcamp B.
Operational update
In late December, the company’s net daily production exceeded 10,000 net BOE. However, Rosehill said, due to severe cold weather, simultaneous operations downtime from Rosehill and offset operator activities, production in January was limited to under 9,000 net BOEPD.
As new wells continued to clean up from initial flowback and downtime decreased, the average company production in February improved to almost 11,000 net BOEPD. The first week of March has seen a continued ramp up of production, Rosehill said, with total company production averaging approximately 13,000 net BOEPD (72% oil).
The company has six wells completed with initial flowback and clean up planned over the next few weeks and expects March’s exit production rate to be up significantly from current levels. Rosehill currently has two rigs drilling and one dedicated frac crew.
President and CEO Alan Townsend commented, “We continue to deliver strong production growth, achieving a new all-time high production rate this month. We are very pleased with this substantial growth and will continue to execute efficiently and continuously look for opportunities to keep improving our operations. We expect significant growth in Adjusted EBITDAX with our increase in production coupled with stronger oil prices.
“We have begun the process of developing our White Wolf acreage through surveying, staking and permitting activities. We plan to perform extensive scientific analysis on the first four new wells and will core Wolfcamp A, Wolfcamp B and Bone Spring intervals,” Townsend said. “We are also acquiring a new 3D seismic survey that will provide important stratigraphic and structural data for our drilling program. It is our plan to gather and analyze sufficient data to aid in the optimization of well spacing, well orientation, landing zones, along with drilling and completion techniques. With our strong production results in Loving county and White Wolf development ramping up, we are growing our company significantly…”
