Frisco startup buys rights to drill for oil in 100,000 acres of Northern Louisiana

Written byMaria Halkias, Retail Writer   dallasnews.com

A new energy company based in Frisco has purchased oil and gas assets and drilling rights for more than 100,000 acres in northern Louisiana and southern Arkansas.

Frisco-based Velandera Energy Partners LLC was formed by investors of Texas private equity firm Schanti Partners for the purpose of buying the assets from Spring-based Southwestern Energy Co. 

The price wasn't disclosed, but it was an all-cash transaction, and Velandera plans to acquire more oil and gas assets, said Manish Raj, chief financial officer of Velandera and a Schanti principal.

Velandera plans to spend $100 million to drill 20 additional wells, Raj said. 

Southwestern Energy told Bloomberg News that it had invested $600 million in the property.  It's been selling assets and plans to focus its drilling in the Appalachia region, a spokesman told Bloomberg. 

"While all the attention has been on Texas' Permian Basin, we think it's very expensive," said Raj. "Northern Louisiana is also oil-rich and equally as attractive with less competitive pricing."

The present value of the proven oil and gas reserves that Velandera purchased is more than $600 million.

Velandera has 3D seismic images of the reservoirs that gave the company confidence to make the purchase and to develop a drilling program, Raj said. He has extensive oil and gas investment banking experience, having worked on the financing for more than $25 billion worth of deals while at Deutsche Bank and Credit Suisse.

Despite the crude oil price decline, American shale drillers have continue to challenge international producers. 

Over time, the industry has become more efficient with shale drilling, Raj said, and companies can be profitable as drilling costs have come down.