EnerJex Resources, Inc. has released an operations update on its Black Oaks Field project, a 1,980 acre property.
EnerJex acquired this field in April of 2007 at a time when the field was producing an average of 31 barrels of oil per day (BOPD). The acquisition was completed based upon the anticipation that a combination of in-fill drilling and secondary enhancement techniques could dramatically increase the average production and ultimate oil recovery from this property.
Phase I of the Black Oaks Field development plan commenced in April of 2007, with the drilling of 44 in-fill wells. In August of 2007, EnerJex began injecting water into the first five water injection wells at a rate of 50 barrels of water per day per well. This pilot program was expanded so that by March 1, 2008, EnerJex was injecting 200 barrels of water per day per well.
The rate of water injection pressure in these five pilot wells all started on vacuum and has increased to between 120 and 180 pounds per square inch (psi). Three adjacent producing wells have increased oil production from an aggregate of three barrels per day to 15 barrels per day since January 15, 2008. "We believe this indicates an initial response to our secondary recovery project. We are very pleased with these initial results, and plan to continue to aggressively expand this project long term," stated Steve Cochennet, CEO of EnerJex.
Field-wide production has increased to an average of 117 BOPD from a level of 31 BOPD per day when the field was acquired in April 2007.
Based upon these results, EnerJex anticipates commencing Phase II of its development plan in the second half of 2008, which would include the drilling of 28 additional water injection wells, targeting water injection rates that will eventually increase to 300 barrels of water per day per well. There are 23 producer wells projected to be added in Phase II.
EnerJex also has an option to develop the Nickel Town Field, a 2,100 acre property in the same area. The Nickel Town Field development plan is anticipated to progress in a similar manner to the Black Oaks Field project.
Mr. Cochennet commented, "Beginning to see an initial secondary response at Black Oaks is a major step toward increasing our level of confidence about the upside potential in the Black Oaks/Nickel Town fields. In order to extrapolate the potential value of the Black Oaks/Nickel Town project, we engaged a third party engineer in August of 2007 to assess the long term potential and the possible contribution to EnerJex. The initial response is consistent with the opinion we received."
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