Callon Petroleum has struck a deal to strengthen its position in the Permian Basin in west Texas by purchasing assets in two fields for $29.5 million, the US oil and gas independent said Monday in a company statement.

Callon moves up in Permian Basin

HOUSTON, November 10, 2015 – Callon Petroleum has struck a deal to strengthen its position in the Permian Basin in west Texas by purchasing assets in two fields for $29.5 million, the US oil and gas independent said Monday in a company statement.

Callon will add a total of 2.5 square metres to its existing assets. With the acquisition, Callon Petroleum will have a 100-percent working interest in the 10.5-square-kilometre Carpe Diem field. The company will also have a 66.5-percent stake in the Casselman-Bohannon field, measuring at 25.2 square kilometres.

The company has recently shifted its operations to the Central Midland Basin, which is a component basin of Permian, by dedicating its two horizontal rigs to drill in the area.

The company will direct $88 million of its $100-million budget in 2016 to developing the two fields with an expected year-on-year growth of 20 percent. Callon further expects that the fields will produce more than 11,000 barrels of oil equivalent per day.

Estimates predict that the Permian Basin will produce 2 million barrels per day by 2018, according to the American Enterprise Institute.

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