Jones Energy Inc. (NYSE: JONE) has acquired a contiguous block of 5,120 net acres in Hutchinson County, Texas, prospective for its primary drilling target, the Cleveland sandstone. The lease was acquired on commercial terms similar to recent lease activity by Jones Energy.
The lease terms provide Jones Energy with 100% working interest at all depths. The initial block represents 40 net drilling locations in the Cleveland formation, which equates to half a year of drilling inventory at current activity levels.
Drilling activity on the new lease acreage is expected to begin in early 2015. Jones has proprietary access to 3D seismic imaging over the newly acquired leasehold and has initiated reprocessing the data. As part of the lease option agreement, Jones retains the right to acquire up to an additional 63,000 net acres over a multi-year period under terms similar to the initial lease agreement.