A 4,590-foot exploratory well was drilled and flow testing has been completed. A 41-hour multi-rate gas test of the well was conducted at rates of up to 800 Mcf per day on a 9/16-inch choke. During the test, the well produced natural gas and condensate with no water. Analysis indicates the gas is rich with natural gas liquids and has a heating content of 1,070 Btu.
"The initial evaluation of this gas discovery is encouraging," said Leon Daniel, Ivanhoe Energy's President and CEO. "The discovery is close to existing natural gas-gathering facilities and markets. We will follow up the testing with an estimate of commercial potential, drilling of an appraisal well and discussions with gas buyers."
Ivanhoe Energy farmed out part of its 1,800-acre Peach prospect in November, 2004. The operator paid 100% of the drilling and associated costs of the well to earn a 50% interest in the prospect. Ivanhoe Energy will retain a 50% interest in this well after payout and will retain a 50% working interest in the prospect.
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