Unbridled Energy Corporation provides an update on its Appalachian Basin properties in the USA.
Many Companies are now leasing land and drilling wells in the evolving Marcellus Shale play in Pennsylvania. Based on the Company's internal research on this shale formation and the significant production rates now publicized by several operators and analysts, Unbridled is implementing a two prong approach to enter the play. First, Unbridled has selected a land acquisition company to begin leasing in Pennsylvania in strategic areas. Second, management is commencing preliminary Joint Venture negotiations with existing local well operators who have large lease positions held by shallow well production. The Company will begin taking leases in February with the intent of securing sufficient acreage to begin planning drilling operations. Based on recent public data, the anticipated production results from the Marcellus are 0.5 to 1.5 MMscf/d for vertical wells and 1 to 4 MMscf/d for horizontal wells. These rates are similar to those exhibited in the prolific Fayetteville, Barnett, and Woodford Shales. The gas content for the Marcellus is also in the range of these prolific shales.
The Company signed a joint venture agreement and a four township (92,160 acres) Area of Mutual Interest Agreement ("AMI") with Equitable Production Company ("Equitable"), a unit of Equitable Resources, Inc. to partner on drilling three horizontal test wells in the Devonian Shales in south central, Ohio. All three well locations have been identified and the anticipated spud date is March 2008. Unbridled and Equitable have now expanded their AMI to include 6 1/2 additional townships (153,600 acres) immediately north and northeast of the original 4 township AMI. Leasing operations are underway.
Within its area of geological study, Unbridled has recently entered into a confidentiality agreement with an operator to review existing well data. Discussions to date include drilling horizontal wells into two specific formations. If and when the parties reach agreement, drilling could commence within 3 months afterwards subject to rig availability.
Unbridled Energy NY LLC. will partner with Schlumberger Data and Consulting Services to acquire new micro-seismic data on its Chautauqua Lake property in New York. The project will be conducted for the New York State Energy Research and Development Authority (NYSERDA) under a $150,000 contract.
The project will collect new reservoir and hydraulic fracture information in the Grimsby, Whirlpool, and Devonian shales in Chautauqua County to optimize future hydraulic fracture treatments. Until now, this region of New York has not been characterized significantly. The project will include collecting advanced logs, core, and micro-seismic data. Schlumberger will provide the technical analysis for the project.
Unbridled will contribute various existing data from its wells in its Chautauqua Lake property, in addition to collecting new data in wells it soon plans to drill and/or re-complete. The project results will be used by Unbridled to help maximize recovery from the estimated remaining net 3P reserves of 31 Bscf (24 Bscf Possible).
The results of this past summer's workover program have been evaluated and show a 25 to 40% improvement in daily production rates from most of the wells that were serviced. Based on the success of the rather modest workover program of 2007, the company is in the process of developing a significant recompletion and work over program that will commence in late Q1 and will run through Q3 2008.
The company is gearing up for a near-term drilling campaign of 10 wells. The anticipated spud date for the program is March 2008. Several winter related factors delayed the start approximately one month. The four recompletions into new formations will also begin in March or earlier depending on weather.
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