Houston American Energy Corp. says it has leased its mineral interest on some 744 acres in East and West Baton Rouge parishes to an unnamed third party, which will drill a new well to test the Lower Tuscaloosa formation.
“We are excited to have partnered with an operator to develop this lease. We believe two wells will be needed to test the Lower Tuscaloosa formation,” Houston American interim CEO Jim Schoonover says in a prepared statement. “However, the number of wells drilled will ultimately be at the sole discretion of the operator.”
Details on when or exactly where the well will be drilled are not included in the announcement, but Houston American says it will be below 19,000 feet. Under terms of the deal, the lessee is paying the Houston-based company a bonus of $600 per acre, for a total of $104,616, and the lease is also subject to a 22.5% royalty.
The leased acreage is among a larger 2,485 acre block that Houston American has an interest in, on which it also has one well.
“This project has the potential to add meaningfully to our reserves, production and revenue,” Schoonover says. “We are looking forward to drilling the planned test well to prove up that potential.”