Plains Exploration & Production Company
) has signed an agreement, worth $8.75 million, with the Trust for
Public Land ("TPL") to sell its oil and gas leases on 58,000 acres
land, situated in the Hoback Basin at the state of Wyoming. Per the
contract, the company will stop its oil and gas drilling activities
in this environmentally sensitive region.
The Hoback Basin in the Wyoming Range is the blend of lively
forests, splendid mountains and wonderful rivers and streams. This
region is an important source of natural wealth along with rich
hunting and fishing exposure. It is also an important corridor for
migrating animals like moose, elk, mule deer and pronghorn
Apart from the stronghold of flora and fauna, Hoback Basin is
famous for the richness of precious minerals. Oil and natural gas
are the important businesses in the state of Wyoming. Most of the
big oil and natural gas players have operations in this region.
The TPL is a national non-profit organization that preserves lands
for people to use as gardens, parks, historical spots and rural
lands. This organization works both within the city and outside
while ensuring livable communities for the future generations.
Since 1972, TPL has shielded more than 3 million acres across the
The signing of the Wyoming Range Legacy Act on 2009 ensures to
protect the Wyoming Range from future energy development, but
allows the existing leaseholders to continue their operations. As
an existing leaseholder, Plains got an opportunity to continue its
operations in the regions. The company filed to drill 136 natural
gas wells in the Hoback Basin.
We note that from the last couple of years, Plains is continuously
changing its exploration strategy due to mixed outlook on long-term
natural gas prices. The company is swinging from low-margin natural
gas to higher-priced oil exploration. We believe that the closure
of the company's natural gas drilling operations in the Hoback
Basin helps it to balance its overall margin.
We believe this significant agreement will sustain ecological
balance of the region and Plains's effort to curtail or close down
the mining operations in the environmentally sensitive regions will
subsequently provide better opportunity to the present as well as
Houston, Texas-based Plains Exploration & Production Company
engages in the acquisition, development, exploration, and
production of oil and gas properties, primarily in the United
States. The company competes with
Newfield Exploration Co.
) and currently retains a short-term Zacks #3 Rank (Hold
NEWFIELD EXPL (NFX): Free Stock Analysis Report
PLAINS EXPL&PRD (PXP): Free Stock Analysis
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