Continental Resources, Inc., has formed a joint venture with a wholly owned U.S. subsidiary of South Korea-based SK E&S Co. Ltd to jointly develop a portion of Continental’s Northwest Cana Woodford natural gas assets, primarily in Blaine and Dewey counties, Okla.
Continental sold a 49.9% interest in approximately 44,000 net acres in the Northwest Cana area of the Anadarko Woodford Shale play, including interests in 37 producing wells, for total consideration of approximately $360 million. Continental received $90 million at closing, and SK has committed to pay an additional $270 million to carry 50% of Continental’s remaining share of future drilling and completion costs.
The companies’ joint development agreement establishes an area of mutual interest in Northwest Cana and certain incentives for the joint venture to expand its leasehold position. Continental will be the operator for all current and future wells that are operated by the joint venture. The company began drilling in the AMI during November 2014, with four operated rigs running by the end of the year.