FormCap Corp. is a junior exploration and development company in the oil and gas sector. In October 2009, the company announced the acquisition of 4,900 acres of oil and gas leases, all with primary terms of five years, for a cost of only $250,000. The leases, together called the Weber City Prospect, are located in eastern New Mexico on the northern flank of the Permian Basin.
The Permian Basin is well known to oil and gas investors in the United States. It is one of the most prolific oil and gas producing areas of the entire world. Through the year 2000, approximately 1,300 reservoirs in the Permian Basin were identified as having cumulative production greater than one million barrels of oil. Cumulative production for this area so far is over 35 billion barrels of oil and 100 trillion cubic feet of gas. Overall, the Permian Basin is the source of over 20 percent of all domestic oil and production.
The Permian Basin, with its development history and stable, long-life, shallow decline reserves, is a strong bet for petroleum exploration companies. It is estimated that only about a third of the huge oil resource in the Permian Basin has been recovered. That is why even oil giants like ExxonMobil are moving quickly into the region.
Due to detailed mapping, Landsat imagery, seismic analysis and log evaluation, FormCap is confident of success for the Weber City Prospect. In addition, based on modeling of a nearby existing field (the Anton Irish field), well recoveries for FormCap’s prospect are expected to range from 100,000 to over 500,000 barrels of oil per well. With 40 acre spacing in the company’s prospect, there is room for approximately 100 wells.
Therefore, FormCap’s Weber City Prospect is estimated to contain potentially 220 million barrels of oil. The bottom line is that FormCap, with their Weber City Prospect, looks to be ideally situated to capitalize on a lucrative opportunity in the prolific Permian Basin.
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