The first well, Spring Creek No. 6-35 was located immediately north of the Company's Palmer Bow Island natural gas prospect. The well was drilled to a total depth of 2390 feet and penetrated four Bow Island sand sequences. While no gas flow tests were conducted during air drilling, the well has been shut-in for a period of 45 days and has shown a pressure build-up to 91 psi. The company will continue its pressure and flow analysis to determine the commercial viability of this well.
The Company's second well was located within its Central Block (located immediately east of the Triangle Zone Prospect Area) targeting the Horsethief sand. The Kipp No. 1 well was drilled to a total depth of 2134 feet utilizing a conventional mud drilling system to allow full petrophysical analysis of open hole logs. The well was cased to total depth based on log analysis which indicates several zones of interest including hydrocarbon bearing zones at depths of 1460-1470' and 1700-1720' in depth that present potential for establishing productive reservoirs. Porosities averaging 12% in the upper zone and 10% in the lower zone are considered less than generally optimal for good flow without stimulation and therefore, the well may require further fracture stimulation to complete a full evaluation. The company plans to move forward with testing procedures on the respective zones. The prospect area contains multiple additional drilling targets along the trend which could result in a significant development project for K2. The Kipp No. 1 well is located approximately 7.6 miles from the nearest natural gas sales pipeline.
The third well drilled by the Company was originally planned and announced to be the Spring Creek No. 9-27, also immediately north of the Palmer field. Following the drilling of the Spring Creek No. 6-35, the Company shifted its third location to drill the Spring Creek No. 15-20 located to the south west of the Palmer field. The well was drilled to a total depth of 2749 feet. Upon penetration of the Bow Island 1A sand, natural gas flow testing was conducted for approximately 3 hours with flow rates observed at approximately 200 to 220 mcf/d. Additional flow testing indicates production rates from this well ranging from 70 to 100 mcf/d.
The Company is encouraged by the results of the above three wells. In the Central Block the Kipp No. 1 exploratory well has potentially identified a new producing structure which could set forth a new prospective exploration area. The results seen to date on the Spring Creek No. 15-20 well reinforces the Company's belief that productive Bow Island sands extends beyond the original parameters of the Palmer field, most likely within isolated structures with clear trapping mechanisms. This well is located approximately 3 miles from the recently constructed gathering system and may require additional drilling prior to tie-in. Over the next few months the Company will continue focus its efforts on furthering its knowledge of its substantial land holdings to identify additional exploration drilling opportunities to exploit either on its own or with joint venture partners.
A significant component of the Company's strategic focus is to develop partnerships with other industry participants. To that end, the Company reports that it has been advised by its industry partner, Zargon Oil and Gas Ltd., that the Kestrel No. 1 Triangle Zone well was drilled to a total depth of 4764 feet and has been cased with two main zones of interest.
Drilling is still underway on the Found-a-Gun No. 1 well, currently at a depth of 2900 feet. K2 Energy continues to discuss with other prospective industry partners for additional joint venture opportunities in several prospective areas contained within its land holdings.
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