Gawler Reports Production Increases on High Island in GoM
Gawler's High Island A-268 gas and oil field located offshore Texas in the Gulf of Mexico has increased production rates since our last report with the field currently producing 17.6 million standard cubic feet of gas per day ("MMscfd") and approximately 287 barrels of condensate per day from two wells. Details of the individual wells are set out below.
Well A-1 Production
Since our last production update on 3 October 2007, production at Well A-1 has increased slightly from 9.0 MMscfd to approximately 9.2 MMscfd. Condensate production has stabilized at approximately 230 barrels per day with no formation water being produced.
The reported flow rate of 9.2 MMscfd was first achieved on 3 October and has been steady at this rate for the past 15 days. The average rate of production from Well A-1 in the 17 day period from 1 October to 17 October was 9.3 MMscfd and 203 barrels of condensate per day.
Well A-2 Production
As a result of Well A-2 cleaning up, production from Well A-2 has increased from 6.5 MMscfd to approximately 8.4 MMscfd. Condensate production has increased from 14 barrels of clean condensate per day and stabilized at approximately 57 barrels per day with no formation water being produced.
The reported flow rate of 8.4 MMscfd was first achieved on 6 October and has been steady at this rate for the past 11 days. The average rate of production from Well A-2 in the 17 day period from 1 October to 17 October was 7.7 MMscfd and 46 barrels of condensate per day.
All production from Wells A-1 and A-2 is going to sales with first cash receipts from sales anticipated in November.
The Company holds a 30% working interest in the High Island field (which is subject to a 5.4% "back-in" following the recovery of Gawler’s initial investment through production sales). Federal and other royalties on production equate to 25%, giving the Company a net revenue interest in the field of 22.5%.
Future Production Announcements
A further update by the company on production results from the High Island Field will be provided in its quarterly report to the ASX due for release on or prior to 31 October 2007.
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