Caza provided an operational update on the Company's San Jacinto, Bongo and Windham projects.
San Jacinto Property, Midland County, Texas: Caza, as operator, was able to secure a rig ahead of schedule and is currently drilling the Caza Elkins 3401 well on the San Jacinto (Wolfberry) property. The well has reached the intermediate pipe point at 4,670 feet. Caza will run electric logs and cement the 9 5/8ths inch casing prior to drilling ahead. The well should take approximately 25 more days to drill to a total depth of 11,200 feet and is targeting the Wolfberry, Strawn and Devonian formations, which produce oil in the immediate area. All subsequent wells will be drilled to approximately 10,500 feet to test the Wolfberry and Strawn formations. The Caza Elkins 3402 well will be drilled immediately following the Caza Elkins 3401 well with the same rig. The property covers approximately 480 acres with five proven undeveloped locations.
Caza has a 100% working interest before completion and an 85% working interest after completion in the first well with a 63.75% net revenue interest. In all subsequent wells on the San Jacinto property, Caza will have a 75% working interest and a 56.25% net revenue interest.
Bongo Property, Wharton County, Texas: The O.B. Ranch #2 appraisal well, which is a direct offset to the O.B. Ranch #1 discovery well is drilling ahead and is currently on schedule. Intermediate casing was set at 7,600 feet, and the well is currently drilling at 8,811 feet. The Company is pleased to announce that log data has confirmed the presence of natural gas in the Frio formation at approximately 5,530 feet. The well is targeting the Eocene, Cook Mountain interval between 12,400 and 12,900 feet, which is the stratigraphic interval producing in the O.B. Ranch #1 well, with an anticipated total depth of 13,500 feet. Data from this well will be integrated into Caza's ongoing seismic modelling effort in Wharton County, Texas, which will be used to better understand the potential size of the Cook Mountain anomaly at Bongo, as well as other potential targets in the area.
The Company has also completed remedial operations on the O.B. Ranch #1 well. Since completing the operations, the well is producing in line with Company expectations at average daily rates of 92 barrels of oil, 674 thousand cubic feet of natural gas and 37 barrels of water.
Caza has a 45.28% working interest and a 33.51% net revenue interest in the Bongo property and wells.
Windham Property, Upton County, Texas: The Caza 158 #3 well on the Windham property has reached its target depth of 9,824 feet, and Caza has elected to participate in the operator's proposal to complete the well. The operator intends to perforate and fracture stimulate all potentially productive intervals seen on the logs simultaneously within the wellbore, which include the Spraberry/Wolfcamp, Penn and Strawn formations. The Caza 158 #3 will be the fourth well drilled and completed on this property. The Caza 158 #1, 158 #2 and 162 #1 wells are currently at various stages in their respective fracture stimulation programs, but are all producing oil and natural gas.
Caza currently has a 25.0% working interest and an 18.75% net revenue interest in the Windham property and wells.
W. Michael Ford, Chief Executive Officer commented, "We are pleased with the status of our ongoing operations at San Jacinto, Bongo and Windham with all three projects progressing on, or ahead of, schedule. The Company is pursuing a balanced strategy of growing both our production and reserve base in order to build further shareholder value, and these projects should provide continued growth in both these areas along with increased revenues. I look forward to updating the market on the progress of these projects, as well as others, in due course."
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