American Eagle Energy Corporation has entered into an agreement for the financing of each of its first six operated wells in the Bakken or Three Forks zones of its Spyglass Project. American Eagle's financed costs of drilling, completing and equipping each of the wells are to be fully funded by the financing source (subject to certain limitations). American Eagle will act as the operator and the wells are to be drilled and completed during the next 12 months. American Eagle will repay the financing source from its share of the net production revenue.
As previously announced, American Eagle has completed the drilling and casing of its first two operated horizontal development wells (the Christianson 15-12-163-101 and Cody 15-11-163-101 wells), which were drilled on adjacent 1280 acre spacing units with lateral sections of approximately 9500 feet each. Both wells targeted the Three Forks zone, which has been proved productive in the offset Legaard 4-25H and the Bagley 4-30H wells that are operated by SM Energy. American Eagle owns an approximate 4 percent working interest in each of the Legaard and the Bagley wells. The Christianson well has been completed and cleaned out and will go on production late this week. The Cody well is scheduled for stimulation prior to the end of May. American Eagle is now in the process of drilling its third Three Forks Formation well at the Coplan 1-3-163-101 location. The cost of drilling, completing, and equipping each of these three wells is included in the funding announced in today's release.
"This financing agreement will enable American Eagle to accelerate its development of the Spyglass Project in an economically advantageous manner. It frees up our capital resources in the near term for us to expand our other lease acquisition and development activities, while permitting us to continue to develop our Three Forks play on a fast track," stated Brad Colby, American Eagle's president.
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