While preparing to hydraulically fracture its Ekho No. 1 deep well below 18,000 feet, Tri-Valley is gearing up to continue exploiting the Sunrise Prospect to access what is estimated to be an exceptional natural gas find.
Both discoveries are in so-called "tight" formations that require additional completion techniques to achieve commercial flow rates, and both have company-maker potential according to F. Lynn Blystone, president and chief executive officer.
"The nation's two biggest dry natural gas plays are Wyoming's Jonah Gas Field and the Barnett Shale play outside Fort Worth, Texas. Each of these required years of trial and error persistence by independent oil companies like Tri-Valley that finally reaped bonanza rewards from solving the engineering obstacles and Tri-Valley expects as much or more from its efforts on its Ekho and Sunrise prospects," Blystone stated.
As an example, he noted the mapped area of closure on the Sunrise Natural Gas Project could contain nine times more gas than the massive Lathrop Gas Field discovery in 1962 that launched a then tiny Bakersfield company, Occidental Petroleum, into a worldwide firm.
"The Sunrise prize, as estimated by independent engineering firms, is well worth persevering to overcome the formation challenges, and Tri-Valley is committed to obtaining the benefit for its drilling partners and shareholders. Of course, it will help consumers, too," Blystone said.
Commercial exploration of the massive Sunrise discovery requires both horizontal drilling and hydraulic fracturing ("frac-ing") of the dense, hydrocarbon-saturated McClure Shale interval to establish pathways for the gas to make its way to the wellbore for faster recovery.
While other wells several miles from the Sunrise area have been successfully produced, the Company noted that no well in California like the Ekho No. 1 deep well has ever been frac-ed. Tri-Valley is pioneering completion programs on both discovery wells and believes its designs will achieve success in both cases to deliver immediate and exceptional rewards.
"We believe that commercial success of these projects will set up the third century of huge oil and gas production in California as we prove these extraordinarily large unconventional targets can be brought in and our shareholders and drilling partners are then richly rewarded for their foresight and risk," said Joseph R. Kandle, president of the operating subsidiary, Tri-Valley Oil & Gas Co.
Even as it proceeds with the complicated efforts in an attempt to establish commercial production on these two major projects, Tri-Valley is preparing to drill other new prospects including Los Gatos Creek near Coalinga, California, the Sunridge Oil Prospect some 15 miles from the Company's Bakersfield headquarters and the Midland Trail wildcat well in Railroad Valley, some 50 miles southwest of Ely, Nevada.
Further, the Company is constantly upgrading its program inventory from its proprietary database of some 700 California leads and prospects and screening prospect submittals from outside geologists and other petroleum companies.
"In addition to increasing investment support of Tri-Valley in the U.S., we are finding growing interest here in Europe as investors look for ways to participate in finding new reserves in secure conditions for the mounting energy demand. Our 42-year track record as a successful exploration and operating company offers opportunities for entry into the larger, high reward targets in the world's fifth largest economy, California, with a voracious, growing appetite for petroleum products. Our meetings here in Europe are an important part of our global capital formation efforts to undergird emerging opportunities to grow Tri-Valley's value and reward our investors," Blystone reported at his London stop on an eight-city, six-country tour.
Also, in anticipation of one or more discoveries becoming commercial from its current drilling program, Tri-Valley is being presented with very substantial international opportunities for its next phase of growth and it is carefully evaluating them along with its considerable U.S. proprietary inventory.
"Having profitably survived the petroleum industry's longest, deepest downsizing over the past two decades, we are now positioning Tri-Valley to be a growing player in the 21st century of the oil and gas business and that may include selected international venues. Led by Joe Kandle's 39 years of North American record-setting experience, Tri-Valley is adding to its hand-picked team of technical experts to both evaluate and implement additional opportunities to grow shareholder value," Blystone said.
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