Rachal Prospect - Webb County, Texas
Whittier has executed a lease for the Rachal Prospect, a 386-acre tract directly offsetting the prolific Owen Field in Webb County, Texas. The Owen field is a large gas field with more than 160 wells producing primarily from the Olmos sands at a depth of approximately 7,300'. The offsetting lease to Whittier's Rachal Prospect is currently producing 700 thousand cubic feet per day (Mcfd) of natural gas from 12 active wells and has cumulative production of 6.2 billion cubic feet (Bcf) of natural gas. Whittier has retained a 30% working interest in the lease. As operator, Whittier expects to spud the Rachal #1 well before year-end. Total estimated drilling and completion cost for the Rachal #1 is $550,000.
Amber Prospect - New Iberia Parish, Louisiana
Whittier has taken a 30% operated working interest in the Amber Prospect in New Iberia Parish, Louisiana. The Amber Prospect is comprised of approximately 200 acres along the southeast edge of the New Iberia salt dome. The Company acquired the lease based on recently reprocessed 3-D seismic data, which identified two potential target sands for the initial test well. In the first quarter of 2005, Whittier plans to test a Miocene interval that is structurally higher than the producing Miocene interval on adjacent leases. Whittier will also test the Marg A sand, which is highly productive on the northern section of the dome. The total estimated cost of the 9,500' test well is $750,000, including $500,000 for drilling and $250,000 for completion.
Acquisition of Additional Interest in Rayne Field
Whittier acquired an additional 11% average working interest in the Rayne Field in Acadia Parish, Louisiana for approximately $174,000. The acquisition increases Whittier's operated working interest in the Rayne Field to approximately 33%. Gross production from the field is approximately 35 Bopd and 770 Mcfd, with Whittier's net production increasing to 11 Bopd and 215 Mcfd net, or 47 net barrels of oil equivalent per day.
Other Drilling Activities
Since the second quarter, Whittier has participated in the completion of six additional wells in the Greater Mayfield project in Beckham County, Oklahoma, bringing the total number of producing wells in the field to 15. These new wells include four of the most prolific wells in the field, which are producing at a combined rate of approximately 130 Mcfd (420 Mcfd net). Currently four additional wells are in various stages of drilling or completion. Although Whittier's average working interest in these wells is less than 1%, Whittier's net production from the area has increased to one Mmcfd from 425 Mcfd.
Bryce W. Rhodes, Whittier's President and Chief Executive Officer, said, "Whittier's purchase of the additional interest in the Rayne Field, combined with our active exploration and exploitation efforts is representative of our portfolio investment approach to growing the Company's production and revenues while managing risk. Given the outlook for commodity prices, we are excited about the opportunity to add new production and reserves through the drill-bit."
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