Cougar O&G Canada announced a 1Q11 multi-well drilling program, targeting the Keg River light oil play, in the Corporation's Trout Core area.
Cougar has purchased and evaluated 10.4Km(2) of high resolution Trout Core area 3D seismic data. The Corporation has identified five (5) drilling targets and will proceed with the permitting for a three (3) well Keg River light oil drilling program. The permitting process, including consultation, surveying, lease acquisition and licencing, will take approximately 90 days and the drilling program, pending financing, is scheduled for February, 2011. The drilling program, which will take place on 85% working interest Cougar leases, is anticipated to take a total of 30 days.
The three (3) well drilling program was selected after an extensive review of the 3D seismic data, the regional and local geological mapping, the core data and the well performance of the existing regional wells. The drilling program will include a new horizontal oil well, a new vertical oil well and the deepening of an existing wellbore to access a new deeper oil formation.
The Corporation conducted an extensive internal review of the regional producing Keg River oil wells as part of the preparation for the proposed drilling program. There were 71 producing Keg River oil wells within a four (4) mile radius of the Cougar main production facility. From the 71 wells reviewed there has been an average of 250,000 barrels of light oil produced from each well and an average production rate of 164 barrels of oil per day per well for the first four producing months. There have only been six (6) wells drilled in the study area within the past fifteen (15) years with most of the wells drilled from 1987 to 1993.
Mr. William Tighe, CEO and Chairman of the Board for Cougar, stated, "We are very pleased to be able to kick off this multi-well drilling program. After reprocessing the high resolution 3D seismic we were able to identify five (5) drilling prospects based on (3) different play types. Three (3) of these drilling prospects will be targeted with the current drilling program and the other two (2) prospects will be included in a future program.
As a result of the technological advances in seismic processing and drilling technology the Cougar management anticipates the proposed multi-well drilling program will achieve results consistent with the averages defined above in the regional study. One of the significant advantages we have over other active tight oil resource plays is that the Keg River oil prospects we are targeting do not require any type of high cost completion techniques. This results in a much more favorable F&D cost and quicker payout than many of the other currently popular resource plays which require multi-stage fracs or other high cost completion techniques.
This drilling program will form a significant component for the Corporation's growth along with continued recompletion and/or optimization activities and other anticipated acquisition opportunities as we continue towards our corporate goal of achieving 2000 barrels of oil production per day by the end of 2011."
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