A principal part of our strategy at Valor Energy Group is to target opportunities that can generate an immediate income stream while providing a value at purchase and increased return with minimum capital commitment.
There are thousands of wells producing at low levels across our country that have valuable, proven reserves still in their coffers. These properties can be acquired at negotiated discounts and brought back to life with relatively small capital investment. In areas throughout the United States, wells are producing at minimum levels.
These properties are sometimes referred to as “stripper wells.” A large number of these wells were completed with less effective technology from 30 or 40 years ago. Many still were walked away from or abandoned by operators they went out of business or as a result of a downturn in commodity prices. Through state agency’s many of these properties can be “adopted” at little or no cost. Some can be purchased at steep discounts from banks who have absorbed them as collateral, and many are on the market by operators without the capital budget to sustain them. A large number of these opportunities exist in areas that today are at the center of North America’s new “energy boom.”
Going into areas where we have well-known geology, existing infrastructure and today’s advancements in technology make these very exciting propositions.” New methods in EOR (enhanced oil recovery) such as CO 2 Injection, water flooding, and others can increase production from these wells 30-40% from current levels. Comparatively, this can be achieved with a relatively small capital investment. These investments also stand poised to benefit greatly if as expected oil and natural gas prices continue their rise in coming years.