Jack Nichols, executive chairman of Redhawk Resources Management III LLC and managing partner of Redhawk Investment Group LLC, said the $15 million Redhawk Resources-Fund III LP was fully subscribed and is closed for further investment. The company has fulfilled the fund, according to an April 26 press release.

The fund is located in the Permian Basin just north of Fort Stockton, Texas. The 3800-acre project consists of the purchase of 70 conventional vertical bore wells originally developed and drilled by Gulf Oil Corp.

With StableRock Energy, the operating entity, the partnership will enhance and develop the project into a waterflood over the next 24 months. The goal is to rework about 20 of the existing wells to pump off a significant amount of primary oil still in place, and 40 wells will be converted to injection sites.

Several new wells will be drilled to enhance production and complete a geometric pattern with sufficient, maximum flooding capability; two to five waterflood stations will be developed.

Nichols was initially attracted to the project by the fact that, at 2.5 million barrels (MMbbl) of oil produced, only 4% of the oil in place had been extracted through primary production and the spacing on the field was liberal by Permian Basin standards.

The field abuts and/or is adjacent to two waterfloods owned by majors; they have been in production since 1978. The two other areas are similar in size and number of wellbores and are still producing 220 bbl/d and 90 bbl/d of oil, respectively, after 35-plus years of production.