First Appraisal Well for the Lingle Oil Project
DENVER, COLORADO USA, BRISBANE, QUEENSLAND AUSTRALIA and VANCOUVER, BRITISH COLUMBIA CANADA - August 19, 2015 (Pacific Time - Canada) (TSX-V:SXE) (ASX:SXA)
- Strata-X has received a drilling permit for the Kuhlig #1 well.
- Kuhlig #1 is a 12 km step-out appraisal well of the Burkett 5-34 horizontal well that reached 300 BOPD.
- Strata-X has contracted Webster Drilling of Kinmundy, Illinois.
- Strata-X expects the well to be spudded the week commencing August 31, 2015.
Drilling Permit Granted
Strata-X Energy has received a permit to drill the Kuhlig #1 well, the second well in the Company’s Lingle Oil Project. The Kuhlig #1 is a 12 km step-out of the first completed Lingle horizontal well, Burkett 5-34, where peak production rates of 300 barrels of oil per day were achieved.
The Burkett 5-34 was a “Proof of Concept” well that successfully proved the Lingle can be drilled and completed horizontally and is capable of commercial oil production. Although this first horizontal test accomplished many of the pre-drill targets, Strata-X expects even better results from the next horizontal well, which will be designed with twice the horizontal leg length and an improved completion method compared to the Burkett 5-34 well.
Kuhlig #1 is a low cost vertical well that will core and pressure test the Lingle to acquire important reservoir data required to design the proposed Raccoon Creek #1 horizontal well. A core will be taken from the bottom of the New Albany through the primary reservoir of the Lingle formation. Confirmation of oil saturation, reservoir thickness and porosity will be key data obtained. The pressure test will be instrumental in the design of future horizontal completion methods as Strata-X fine-tunes the approach to optimizing commercial oil production.
The Kuhlig #1 is expected to intersect up to 16 feet of the Lingle reservoir, and to encounter higher initial reservoir pressure and oil saturations than the Burkett well. It will be drilled a short distance from a historical well that has log data indicating oil saturations in the reservoir. The subsequent Raccoon Creek #1 horizontal well will be drilled up-dip from the Kuhlig #1 location and toward the historical well.
The drilling of Raccoon Creek #1 is tentatively scheduled for early 2016, subject to funding. Strata-X is investigating hybrid methods to fund future horizontal wells, which may include joint ventures. Strata-X’s 100% ownership of the projects offers flexibility on the later funding options.
Subject to weather, the Company expects to spud the well in the week commencing August 31, 2015. An update on the status of the well will be provided upon the commencement of drilling operations.
Summary of the Lingle Oil Project
The Lingle Oil Project is targeting light gravity sweet oil from the Devonian-aged Lingle Formation. Estimates of Petroleum Initially In Place under the Company’s acreage is approximately 240 million barrels1. It is expected that a recovery factor of at least 10% can be achieved in the Lingle Reservoir. ASX disclosure note - 5.28.2 - The estimated quantities of petroleum that may potentially be recovered by the application of a future development project(s) relate to undiscovered accumulations. These estimates have both an associated risk of discovery and a risk of development. Further exploration appraisal and evaluation is required to determine the existence of a significant quantity of potentially moveable hydrocarbons.
Tim Hoops, the Company’s President, stated, “the Kuhlig #1 and the subsequent Raccoon Creek #1 horizontal well are expected to have nearly twice the reservoir thickness, more than twice the horizontal length and have much better reservoir pressure than our pioneering Burkett 5-34 horizontal well. The combination of these favorable factors should provide us with much improved performance and position us for development of this exciting project”
Strata-X is a Denver, Colorado (USA) based company and is engaged in the business of oil and gas exploration and development with a variety of exploration opportunities in North Dakota, Illinois, California, Texas and Western Australia and production and development opportunities in California. Strata-X has 166,895,227 common shares outstanding and trades under the symbol “SXE” on the TSX-V and “SXA” on the ASX.
|Tim Hoops (USA)||or||Colin Christensen (Canada)|
|+1 855-463-2400||+1 403-483-8363|