In 2006, Teton participated in the drilling of 20 wells as part of the initial pilot program on the Area of Mutual Interest ("AMI") with Noble Energy, Inc. ("Noble Energy"). Teton's position in the eastern Denver-Julesburg ("DJ") project is currently 266,572 gross acres with a 25 percent working interest. The Company and its partner have completed the tie-in to the gathering system in the Chundy area and have connected five gross wells. These wells, along with others that will be connected over the next week will be flow tested for commercial viability over the next 30 to 45 days. In the Grant area, the gathering system is under construction and is expected to come on line in mid-April.
The pilot program will now move into the next phase of evaluation. Pending the confirmation of commercial flow rates in the Chundy and Grant pilot areas, Teton expects to revise its 2007 capital spending program. Current plans call for Teton to participate in an expanded 2-D and 3-D seismic program encompassing approximately 50 square miles and to participate in a 90 well development program for 2007. Teton estimates that it could spend an additional $6.9 million net to the Company for DJ development in 2007. Total capital spending for the Company is now estimated to be $27.3 million.
"We are pleased with the progress of development of our eastern DJ Basin project," Dominic Bazile, Chief Operating Officer, stated. "With an aggressive drilling program for 2007 and further development, the eastern DJ project could become a second core asset for Teton providing another multi-year drilling program."
Teton Energy Corp. is an independent oil and gas exploration and production company based in Denver, Colorado. Teton is focused on the acquisition, exploration and development of North American properties and has current operations in the Rocky Mountain region of the U.S.
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