Clayton Williams to Plug & Abandon McIlhenny #1 Well

Louisiana Drilling Results

The Company is preparing to plug and abandon the McIlhenny #1 (Tabasco), an 18,300-foot exploratory well in Vermillion Parish. The Company will record a pre-tax charge of approximately $4 million related to the abandonment of this well for the fourth quarter of 2004 and approximately $1 million during the first quarter of 2005.

The Company has successfully completed the Orleans Levee District No. 1 (American Bay) in Plaquemines Parish, in the Tex W.-A sand in intervals between 12,910 and 12,993 feet. The well was completed as a gas well and tested at an average of 6,525 mcfpd, 482 bopd and 10 bwpd with a flowing tubing pressure of 4,089 psig. The Company expects the well to be on line in the fourth quarter of 2005 after completion of production facilities. The Company owns a 45% working interest in this well.

Mississippi Results

The Company is preparing to plug and abandon the Mississippi State University #1, a 17,000-foot exploratory well in Oktibbeha County targeting the Stones River formation, after attempts to complete the well as a commercial producer were unsuccessful. The Company is also preparing to plug and abandon the Inez West et al #1, a 12,000-foot exploratory well in Webster County targeting the Penn formation. The Company encountered mechanical problems while drilling to a secondary target formation, preventing the Company from further evaluation of the well. The Company will record pre-tax charges of approximately $5.4 million during the fourth quarter of 2004 and $2.2 million during the first quarter of 2005 related to the abandonment of these wells.

Based on the drilling results of the Mississippi State University #1 and the Inez West et al #1, the Company will record a pre-tax charge of approximately $5.2 million during the fourth quarter of 2004 to impair the remainder of its Stones River acreage and a significant portion of its Penn acreage. This charge is in addition to the previously announced impairment of $8.4 million recorded after the abandonment of the Weyerhaeuser #1 well in December 2004. The Company is continuing to carry approximately $1.1 million of unimpaired acreage costs attributable to one prospect in the Black Warrior Basin that the Company believes is prospective for Penn production.

Events  SUBSCRIBE TO OUR NEWSLETTER

Our Privacy Pledge
SUBSCRIBE


Most Popular Articles
Related Articles


Brent Crude Oil : $53.96/BBL 0.35%
Light Crude Oil : $51.36/BBL 0.21%
Natural Gas : $3.209/MMBtu 0.34%
Updated in last 24 hours