LINN Energy has signed a joint-venture deal with an affiliate of Anadarko Petroleum Corporation for the CO2 enhanced oil recovery development of the Salt Creek field in the Powder River Basin in the US state of Wyoming.
Under the deal, the oil and natural gas company has agreed to pay $400m over the next three to six years for Anadarko's development costs and another $200 million for a 23% stake in the field.
LINN Energy chairman president and chief executive officer Mark Ellis said, "We believe this long-life asset is unique because it is expected to deliver 10 years of steady production growth while, at the same time, providing a low base-decline rate.
Anadarko has been utilising CO2 to develop the field since 2004 and additional development related to the joint venture is expected to double current production by 2015.
"Consistent with our strategy, we have already hedged all of the current net production associated with this joint venture through 2014, and we believe it will be immediately accretive to distributable cash flow per unit," added Ellis.
Image: Additional development at the Salt Creek field is expected to double production by 2015.Photo:Anadarko Petroleum Corporation.