Triangle Petroleum Corporation's first exploration well of the 2008 drilling season, the N-14-A well, was spud earlier this month and is currently drilling. This is a vertical well with a target depth of 3,000 meters (10,000 feet). It is located approximately 5 miles north of Triangle's two original vertical test wells, Kennetcook #1 and Kennetcook #2. The well location was identified based on the interpretation of previous well results and an extensive seismic database. The objective of this well is to penetrate the Horton Bluff shale in a separate, deeper fault block, where the shale is expected to be significantly thicker than anything the Company has drilled to date in the Windsor Block. A comprehensive logging, coring, and laboratory analysis program will be undertaken in order to assist management in determining the most appropriate zones to complete later this fall.
As of the date of this release, the Company has received approximately $6.5 million from its joint venture partners related to the Windsor Block. Approximately $3 million was received from one partner for reimbursement of Triangle's 2007 seismic and test well expenditures and approximately $3.5 million has been received, in advance, from both partners for the drilling of the N-14-A exploration well. The partners have agreed to fund 80% of this well. Triangle is responsible for 20% of the costs and will retain at least a 45% working interest in the wells and associated lands.
Howard Anderson, President of Triangle's operating subsidiaries, stated, "We are very pleased with our partners' technical and financial participation in the Windsor Block shale project. We look forward to assessing the log and core data from this current drilling program in order to design an appropriate completion, frac and test program for these wells to be executed in the fourth quarter of this year."
Beech Hill Block (68,000 gross acres) in New Brunswick
The Company has completed the acquisition phase of approximately 30 kilometers (18 miles) of 2-D seismic on the Beech Hill Block. As part of the farm-in agreement, Triangle now has until the end of this year to interpret this data and decide whether or not to drill a well by mid-2009 in order to earn a 70% working interest in this block of land. Zodiac Exploration Corp. has paid $250,000 towards the seismic program, thereby retaining an option to participate in the drilling of the first well. Terms would require Zodiac to pay 50% of Triangle's cost to earn a 25% interest in the lands.
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