Bayswater Resources and Bayswater Natural Resources Fund III and the York Tactical Energy Fund, through its structured development capital strategy, YTEF Drilling Capital LLC, have formed a strategic joint venture. Under the terms of the agreement, YTEF has committed to fund an undivided portion of up to 63 horizontal oil and gas wells located on six well pads for the development of Bayswater’s flagship Weld County, Colorado acreage position located in the volatile oil window of the Denver Julesburg Basin.
The investment will fund the drilling and completion of the joint wells targeting the oil-rich Niobrara A, B, C, and Codell stacked-pay intervals in accordance with a mutually agreed development plan. In exchange for funding a portion of the capital expenditures required to develop the joint wells, YTEF will receive an assignment of working interests entitling YTEF to receive a portion of the revenues from such wells. The joint wells are anticipated to be drilled and completed through the fourth quarter of 2020. YTEF anticipates that it will fund up to USD 125 million of capital expenditures relating to its participation. Willkie Farr & Gallagher served as legal advisor to YTEF on the transaction. Brownstein Hyatt Farber Schreck served as Colorado regulatory counsel to YTEF.