Operations Overview
Synergy’s core area of operations is in a very prolific oil and gas producing area where management has long-term, hands-on experience known as the Denver-Julesburg Basin (commonly referred to as the D-J Basin).
The D-J Basin is a hydocarbon-rich area centered in eastern Colorado that extends into southeast Wyoming, western Nebraska and Kansas. Oil and gas has been produced from the D-J Basin since its discovery in 1901. It has been one of the most important producing areas in the country. The total value of past production from this area, if calculated using today’s prices, would exceed $150 billion.
Relative to other producing regions the D-J Basin has many positive attributes that include:
- Low drilling and completion costs
- Rapid return on investment
- High level of predictability
- High drilling success rate
- Rich in drilling opportunities, including horizontal drilling in the Niobrara formation
- Long life production and reserves (30+ years)
- Liquid-rich natural gas (high BTU content)
- Takeaway capacity
Our strategy for continued growth includes additional drilling activities, acquisition of existing wells, and recompletion of wells that provide good prospects for improved hydraulic stimulation techniques. We attempt to maximize our return on assets invested by drilling and operating development wells in which we have a significant net revenue interest. We attempt to limit our risk by drilling in proven areas. To date, we have not drilled any dry holes. All of our current wells are relatively low-risk vertical or directional wells, and we do not currently have any horizontal wells. However, the success rate of horizontal wells drilled by other operators has recently improved and we are participating in two horizontal wells with major operators.
