Corridor Hits Oil Pay at New Brunswick Gas Field

McCully K-66 & M-66
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Corridor has made a potentially significant oil discovery at its South Branch G-36 well situated 3 kilometers southeast of the McCully natural gas field in southern New Brunswick.

The G-36 well penetrated a thick sequence of Hiram Brook sands containing indeterminate fluid content based on well logs prior to being drilled to a total depth of 2642 meters, nearly 500 meters into the underlying Frederick Brook shale. The well has been cased and two frac stimulation treatments have been carried out over two intervals within the Hiram Brook formation.

The first frac, conducted over 10 meters of potentially gas bearing sands within the depth interval 1757 - 1840.5 meters in the lower Hiram Brook formation, yielded a show of oil and no measurable amounts of gas and is considered to be tight. The second frac was conducted in a 38 meter thick sand within the depth interval 1574 - 1612 meters in the upper Hiram Brook formation. The frac placed 30 tonnes of proppant prior to being prematurely concluded due to a frozen water line which may have reduced the effectiveness of the frac.

Following 10 days of flow-back and clean-up of frac fluids, the well was flowing clean, 45 degrees API oil and no water at a measured rate of 59 barrels of oil per day through production tubing. The well is currently shut in awaiting installation of a pump to reduce down-hole pressure and increase the rate of production prior to undertaking long-term testing later in December to evaluate the economic potential of the well. An additional 31 meters of potential oil pay (previously reported as potential gas pay) in the upper Hiram Brook formation have not as yet been completed in this well.

The G-36 well is located on the southern flank of the Elgin Subbasin, where Corridor has recently completed a $2.5 million 3-D seismic program in the area surrounding the well. Following completion of the initial interpretation of the new seismic in early 2009, Corridor plans to drill an initial offset well to commence appraisal of the discovery. The G-36 oil discovery has been named the Caledonia Field in recognition of the southern bounding basement rocks of the Caledonia highlands.

McCully Gas Field Activities

Frac'ing, testing, tie-in and well clean-up activities are continuing at the McCully Field. Operations to clean up the N-66 horizontal well and turn it into production are progressing, resulting in an increasing test rate of 2.9 mmscf/day at a wellhead pressure of approximately 500 psi. The well has been temporarily shut in to clean out a sand plug at the base of the production tubing. Operations to install a casing patch in the I-47 horizontal well are planned to be completed by mid-month followed by a planned four-stage frac of the "E" sand later in the month. Production from the J-47 well appears to be stabilizing at a rate of approximately 3 mmscf/day at a flowing wellhead pressure of 600 psi 34 days after coming on-stream at an initial rate of 7.1 mmscf/day. Corridor expects to have all of the 2008 completions tied in and on production later this month and to achieve a gross field year-end exit production rate of between 35 and 40 mmscf/day, depending upon the results of current well clean-up activities and the success of the multi-stage frac in the I-47 horizontal well.

Elgin Shale Gas Activities

Drilling activities at two shale gas appraisal wells in the Elgin area (located approximately 20 kilometers to the east of the McCully Field) are progressing. The Green Road G-41 well has been drilled by Nabors Rig #86 to a depth of 1118 meters and intermediate casing has been run and is currently being cemented in place. This well will be deepened to penetrate and partially core the Frederick Brook shale prior to conducting two fracs in the well later this month or early in the New Year. The Logan coring rig is currently drilling ahead at the Mapleton N-11 well at a depth of 301 meters after setting surface casing at a depth of 176 meters. Corridor plans to core a full section of the Frederick Brook shale in N-11 to assist in appraising the characteristics of the shale at this relatively shallow location.


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