Mayan (AIM: MYN), the AIM listed oil and gas company, is pleased to announce that the Company has concluded discussions with its Farm-In partner and consequently will now revert back to retaining a 100% working interest in the Zink Ranch Field in Osage County, Oklahoma ('Zink Ranch' or the 'Field'). Mayan has further received a proposal from an established third-party contract operator based on an independent review by a leading geologist in Osage County identifying up to 3.5 million barrels of recoverable oil that can be economically developed through a multi-phase, low cost development programme. Zink Ranch comprises 1,560 net acres held by current production of approximately six barrels of oil equivalent per day. The development programme establishes a 160 gross barrels per day end of 2019 target for Zink Ranch.
Eddie Gonzalez, Managing Director, said: "We are pleased to have resolved matters at Zink Ranch and agreed a way forward. Zink Ranch has similar characteristics to the Forest Hill and Stockdale Fields where following workovers of existing wells and the application of new techniques and technologies we recently announced combined total production of 272 gross / 137 net barrels of oil per day. Specifically, Zink Ranch is a proven oil producing field, with shallow wells and multiple pay zones in an oil friendly domicile, the State of Oklahoma and furthermore we already own 100% of the asset.
"Adoption of this development plan at Zink Ranch in no way lessens our commitment to growing our well count at the Stockdale or Forest Hill Fields, but rather adds an additional set of wells on which we can implement the technologies and techniques that have proven to be so successful on the Texas fields. Mayan continues to progress towards its near-term target of a total production rate of 500bopd, and we look forward to updating shareholders with updates from across our portfolio."
Zink Ranch History
An 85% interest in Zink Ranch was originally acquired by the Company in 2014 as a non-operated asset with a local third-party operator in place. The Company made a brief attempt to workover four wells with some initial positive success (see RNS dated 02 May 2014) however work was delayed partly due to regulatory changes occurring at the time in Osage County, Oklahoma which have now been resolved. Following the oil price collapse of Q4 2014 and a change in focus to develop other assets in the Company's portfolio, no serious development of the Zink Ranch Field was undertaken.
In the intervening period, Mayan has secured the right to operate Zink Ranch as per the terms of a 2017 agreement with the legacy operator (see RNS dated 26 June 2017). In addition, having its own technical staff, proven well evaluation tools such as the Roke Quad Neutron Log tool, and stimulation technologies and expertise at its disposal, the Company believes Zink Ranch represents a low cost, high impact opportunity to rapidly build production.
An Earn-in Agreement was entered into with Longview in July 2017 however due to delays in securing the operator rights and operational capacity constraints in Oklahoma on the part of Longview (as referenced in the RNS dated 22 December 2017), an alternative development strategy has been pursued by the Company. Mayan is in discussions with an industry partner with respect to participation in field development on a 50-50 basis.