Shoal Point announced that casing has now been run to a depth of 1711 meters in the 3K-39 well and is being cemented into place. Once this operation is completed (expected to be in the next few days), the current rig in use will be released and a service rig will be brought in to complete the planned testing program.
The next stage of testing, subject to applicable regulatory approvals, will include a test over the open lower carbonate-rich section of the well to the total depth of 1745 meters, from which promising hydrocarbons were encountered during drilling and logging operations. Thereafter it is planned to perforate the casing and test a series of fractured shale zones (between 1325 and 750 meters) which were identified from log analysis and core data, and which, from a series of open-hole closed chamber drill stem tests, indicate significant natural permeability. These planned tests are expected to begin in mid-August and take up to 3 weeks to complete.
At the same time, the Company is waiting for the results of the core analysis being undertaken by Ingrain Digital Rock Physics Lab in Houston, Texas. These results are expected to complement the log analysis carried out by NuTech Energy Alliance. In addition, discussions have commenced with a major petroleum consulting company to prepare an initial resource estimate and 51-101 report.
Shoal Point has also closed the second tranche of a financing of common share units for the purpose of completion and testing Well 3K-39 on EL 1070. The total amount raised from both tranches of this financing is $2,035,250.
The first tranche of the financing for $535,500 was comprised of 1,785,000 common share units at $0.30 where each unit includes a common share at $0.30 and a 1/2 common share purchase warrant where a full warrant entitles the holder to acquire an additional common share at a price of $0.40 for 18 months. The second tranche of financing for $1,499,750 included 4,285,000 flow through units where each unit is comprised of a flow through common share at $0.35 and a 1/2 common share purchase warrant where a full warrant entitles the holder to acquire an additional common share at $0.40 for 18 months.
In connection with the total financing of $2,035,250, the Company is paying cash fees totaling $122,115 to registered agents and issuing 364,200 broker warrants. Each broker warrant will entitle the holder to acquire an additional common share at a price of $0.30 for a period of 18 months.
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