Mads Andersen on a field visit to Louisiana at the beginning of October 2023.

The well you see is a typical candidate when we talk about work-over wells (Re-Entry), a well that has not been looked after for a few years and is therefore no longer in production. The reasons can be many, often they are mechanical problems such as a faulty motor, leaking production pipe or a pump unit down the well that is faulty and the current owner has not resolved to spend money on the well or lacks the capital to do the necessary work, often could it also be that what the current owner can produce from the well, typically 5-10 barrels per day, does not fit into their business model as they only want the wells with production of +50 barrels per day.
On the other hand, these wells fit our model perfectly, because we would like to get hold of them, because good money can be made even if the wells are at 5-10 barrels per day. We also obtain good tax advantages on the oil by having production below 10 barrels per day on our wells, namely only 3.2% in oil tax to the state as our wells are classified as marginal wells, in technical terms what is called "stripper wells". Our operators can often do things much cheaper than the big companies' operators who are often bigger companies with more fixed operating costs than we have overall.