Gasco provided an interim operations update on its Riverbend Project in Utah's Uinta Basin.
Green River Oil Well Permits Received
Gasco recently received the necessary federal drilling permits for two oil wells that will be drilled to test the productive potential of the Green River Formation at approximately 5,500 feet proposed total vertical depth. The Company plans to commence building the locations next week and anticipates spudding the wells within the first two weeks of October 2011.
Gasco is operator of both wells with a 100% working interest. The wells, the Federal 23-30-G-9-19 (76.8% NRI) and the Federal 34-19G-9-19 (80% NRI), will be drilled in succession with a recently contracted 1,000 horse-power drilling rig which the Company has secured under a two-well contract. Gasco anticipates that completions for both wells will follow shortly after both wells have been drilled with first production to occur in November 2011.
Current commodity prices feature strong potential per-well economics for the Green River play. Gasco estimates that the cost to drill and complete a Green River well is approximately $800,000, with per-well estimated ultimate recoveries of 50,000 barrels of oil. The current differentials to West Texas Intermediate for Uinta Basin Black Wax, adjusted for transportation and quality, are approximately $16 per barrel.
"Despite the permitting delays, we are pleased to commence operations on the two-well Green River program," said King Grant, Gasco's President and CEO. "We have selected high-graded locations which benefit from existing well logs from gas wells that were previously drilled by Gasco. By proving the productive potential of the Green River Formation, we believe we can begin to de-risk approximately 11,000 net acres which we believe are prospective for crude oil in this part of the Uinta Basin."
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