Aurelian provided the following operational update.
- Drilling ends at Niebieszczany-1, the first of a three well program in Bieszczady. Two intervals totaling 60 meters to be put on flow test. Follow up well planned for H1 2012.
- The operator PGNiG and the Bieszczady partner group have decided to end drilling at 4,219 meters due to high pressure in reservoir.
- 60 meters of formation that has already produced oil, condensate and gas in earlier drill stem tests will now be put on flow test for up to 14 days.
- Follow up well in H1 2012 to be designed for high pressures enabling partners to reach original Niebieszczany-1 primary target areas containing up to 100 million barrels (gross) of oil as well as potentially appraising 60 meter test zone.
- Aurelian cost exposure on drilling and proposed test, limited to €3.5m due to fixed cost turnkey contract.
- Second Siekierki Multi-Fracced Horizontal Well ("MFHW") Trzek-3 fracking operations ongoing.
- Currently working on final frack of six frack program.
- Operations currently on budget with no material mechanical issues.
- 14 - 21 day stabilized flow test expected to commence mid-August.
- First Siekierki South-West well, Krzesinki-1, at 2,007 meters.
- Current depth 2,007 meters. Target depth of 4,150 meters expected to be reached early Q4 2011.
- Targeting mid case of 44bcf net to Aurelian.
- Well on trend with conventional producing fields and at present horizontal drilling and fracking are not planned.
Rowen Bainbridge, Chief Executive commented, "While the primary targets on Niebieszczany-1 were not reached, we are encouraged that the operator, PGNiG, is about to commence the flow testing of 60 meters of formation that has already produced oil, condensate and gas in earlier short term tests. We look forward to the results of these flow tests and to better understand their implications for the design of the follow up well in 2012 and for the potential commercialization strategy for Niebieszczany-1.
The frack operations in Trzek-3 are almost complete and we look forward to commencing the stabilized flow test later this month. We are also making good progress on our Krzesinki-1 well and look forward to reaching target depth early in Q4 2011. Krzesinki-1 is an exciting prospect which, if successful, could add significant conventional gas to the existing 346 bcf (net to Aurelian) in the Siekierki Tight Gas Project."