Northern Sun Signs Strategic Farm-in
Northern Sun Exploration has entered into various farm-in prospects on 30 sections (19,200 acres) of mineral rights in southwest Saskatchewan and 6 sections (3,840 acres) of mineral rights in central Alberta near Camrose. The farm-in establishes a new area of operations for the Company consisting primarily of development drilling with approximately 20% of the farm-in ranked exploration.
Chris Cooper, President and CEO commented "Northern Sun is excited to be able to add a new area of operations to the Company which are relatively low risk and could add substantial production in the short term. We believe this is the start of a very successful development play, and we look forward to the commencement of operations on this new opportunity." The Company plans to begin drilling on the new lands described below by the end of March 2005.
Southwest Saskatchewan (30 Sections):
Battle Creek - Oil & Gas (14 sections)
The Company has committed to drill at least two horizontal development wells in the existing producing Madison formation, with the additional opportunity to explore for deeper oil. Northern Sun will pay 100% of all costs to earn a 70% working interest in the wells and production. The Company has also committed to drill six vertical gas development wells in the existing producing field with a further opportunity to drill an additional four gas wells per section. Northern Sun will pay 100% of all costs to earn a 67.5% working interest in the gas wells and production. Northern Sun has access to high quality 3D seismic data as well as access to an existing gas gathering system and compression and oil battery.
Divide - Gas (16 sections)
The Company purchased a 50% working interest in 16 sections of land and two existing wells and will jointly drill one exploration gas well and will re-enter the two existing wells to fracture stimulate them to enhance deliverability. The Company plans to drill additional wells in the area after evaluation of the initial well results and will pay 50% of all costs to earn a 50% working interest in any follow-up well activity. The Company paid $500,000 to participate in the Divide joint venture.
Bittern Lake - Oil & Gas (6 Sections):
The Company has committed to drill one exploration gas test well into the
Ellerslie formation with the possibility of a deeper Leduc oil test with a
rolling option to continue to develop either the gas or oil play. Northern Sun
will pay 100% of all costs to earn a 67.5% working interest in the gas wells
and production. Northern Sun has access to extensive 3D seismic over the lands
as well as access to an existing gas gathering system to facilitate
- Northern Sun Exploration Exploratory Wells Promising (Jan 22)
- Northern Sun Makes Discovery at Worsley (Aug 29)
- Northern Sun Begins Drilling at Worsley (Jul 06)