TXO Partners, L.P. (NYSE: TXO) is designed as a natural resources production company committed to distributing ongoing cash returns while delivering long-term value to unit holders. This strategy is based on its long-lived, low-risk property base, coupled with strong financial stewardship.
“TXO has built a portfolio of oil and gas rich assets with tremendous potential for development. The confidence we have in the performance of these properties provides the foundation for our premium distribution company,” stated Bob R. Simpson, Chairman and CEO. “With this perspective, our technical team has identified another extraordinary play within TXO’s vast operated production base. The Mancos Shale is an upcoming, giant natural gas field where we hold a 58,500 contiguous- acre position that is held by production. The target holds nearly 3 Tcfe of natural gas potential. On an oil equivalent basis, we believe this could represent as much as five times our current total reserve base. The catalyst for action in developing this project is commodity price, and we anticipate strong natural gas economics ahead.”
“We believe the Mancos Shale development will be a game-changer for our reserve holdings and production potential,” continues Gary D. Simpson, President of Production and Development. “TXO acreage and operations reside in prime position. Offset drilling on adjoining acreage has confirmed well results. Given all the important criteria—reservoir characteristics, acreage location, productivity data, and infrastructure access—we have identified a tactical 3,520-acre block as Phase I for developing and monetizing reserves, representing about 6% of our current Mancos position. Specifically, our internal engineers estimate that this single position holds about 200 to 300 Bcf of natural gas with 25 Bcfe estimated per drill well and has the potential to almost double our existing natural gas reserves. Importantly, the company’s acres for exploitation are held by production with no leasehold expiration dates. We expect to drill, develop, and monetize at an economically opportune time and pace. We believe this high-impact, shale project will drive extraordinary value for our owners.”
For perspective, Exhibit A reflects the summary of our Mancos Play Phase I project within the scope of the total 3 Tcfe of captured potential, which is in excess of 58,000 contiguous acres. The ongoing cash flow from all activities will be allocated to capital investment decisions, unit distributions, and debt management.