As previously announced, Highpine has agreed to acquire all of the issued and outstanding shares of Kick pursuant to a plan of arrangement which is expected to close on or about August 1, 2006. The Arrangement is subject to approval by the Court of Queen's Bench of Alberta, applicable regulatory authorities and Kick shareholders.
The Companies wish to announce that four (4) new Pembina wells have been cased as potential new Nisku pool discoveries. Kick's 6-6-48-10 W5M well (100% WI) encountered an approximate ten (10) meter hydrocarbon net pay column in the Nisku zone and its 12-5-48-10 W5M well (100% WI) encountered an approximate fourteen (14) meters of net pay in the Nisku zone. Highpine's 5-14-48-11 W5M well (75% WI) encountered a porous Nisku reef containing approximately six (6) meters of net pay and its non-operated 6-13-48-10 W5M well (50% WI) discovered a Nisku reef containing a hydrocarbon column with an estimated net pay of five (5) meters. Each of these net pay estimates have been independently determined based on wellbore evaluation logs and geological samples. All wells require completion and testing to determine the oil and/or gas content and the well productivity. Further, all are expected to be completed over the next several months, and assuming economic success, will be tied-in as expediently as possible, with a year-end tie-in target.
Two drilling rigs are now moving to the next Nisku locations at 7-28-48-11 W5M (68% WI) and 4-21-47-11 W5M (100% WI). Drilling of additional Nisku licenced prospects will follow after these wells are completed. In addition to drilling in Pembina, Highpine has two drilling rigs actively operating in its West Central Alberta Gas Fairway.
On the licencing front, the Companies have seven (7) drilling licences in place, including the 7-28 and 4-21 drilling locations. The Companies have submitted or expect to submit in excess of 20 additional applications to the AEUB for approval and continue to work on many more Pembina Nisku drilling permits. Highpine continues to remain confident in successfully executing its consultation program for obtaining permits for drilling its substantial inventory of Nisku wells.
Recently, Highpine cased two (2) potential Nisku producers. These wells are now being completed and tested. The non-operated 15-1-49-10 W5M well (25% WI) was flow tested at rates of up to 111 e(3)m(3)/d (3.9 mmcf/d) of raw gas and 201 m(3)/d (1,270 bbls/d) of oil at a flowing pressure of 6,535 kPa. Also, the non-operated 1-17-48-9 W5M well (50% WI) is expected to be perforated and tested within the coming week. Economics and timing for tie-in of these wells is ongoing.
In the West Central Alberta Gas Fairway, a 100% owned Highpine well in Joffre was recently drilled, completed and tested. This well flowed at a test rate of in excess of 400 bbls/d of 30o API oil. This well is expected to be pipeline connected and brought on stream within the next 60 days. Additional prospective lands are being acquired as a result of this production test.
Highpine and Kick are Calgary-based oil and natural gas companies engaged in exploration for and the acquisition, development and production of natural gas and crude oil in western Canada. Highpine and Kick's current exploration and development efforts are focused in the West Pembina Nisku and West Central Alberta Gas Fairway, both located in Central Alberta. Highpine's Class A Common Shares and Kick's Common Shares trade on the Toronto Stock Exchange under the symbol "HPX" and "KEC" respectively.
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