Great Plains Exploration has provided a brief progress report on its winter capital program and drilling plans for the first half of 2009. In response to current and forecast commodity prices, the Company has scaled back its spending plans and has chosen to focus solely on projects that provide opportunity for material production growth.
In Northeast BC, Great Plains has drilled or is drilling three exploratory tests at Klua, Gunnel and Helmet plus a series of workover and
At Gunnel, a 100% exploratory test has been drilled, cased and completed as a potential Debolt gas well. Initial completion results are encouraging and pressure testing and evaluation is ongoing. The well tested at a rate of approximately 20 e3m3/d (710 mcf/d), with further stimulation expected to improve this preliminary rate. A pipeline license has been acquired for the Gunnel well which would allow tie-in this winter season pending final test results.
Great Plains has commenced drilling operations at Helmet to drill a well analogous to an existing Great Plains gas well currently producing from the Debolt formation at approximately 2 MMcf/d. This new well is targeting 2 to 3 bcf of gas with Great Plains operating and holding a 50% working interest. Pending a successful completion, this well will require a 100 metre tie-in to existing infrastructure which would allow for the commencement of production before break up.
The Great Plains technical team has identified three to five potential follow-up locations at Helmet which could be drilled in winter 2009-2010 subject to commodity prices and capital availability.
In Northeast BC generally, the Great Plains technical team will continue to focus on assembling and refining a multi-year prospect inventory supported by an extensive seismic database. The Company's area land base totals approximately 50,000 acres plus an additional 370,000 acre block in which Great Plains has the exclusive right to explore over a four year period. In the Greater Pembina area, Great Plains continues to actively pursue the evaluation and extension of the Nisku oil fairway. The Company will participate in a total of three wells which are currently licensed with a fourth license expected within the next month. A fifth license application for a location at 14-35-5-6 W5M (46% W.I.) will go to a hearing process commencing in April with potential for a ruling by summer 2009.
Of the wells which are currently licensed, Great Plains is participating at 40% working interest in an exploratory test which has commenced drilling at 14-33-50-5 W5M. A successful outcome at this location would allow for the construction of a pipeline to produce not only the 14-33 well, but behind pipe volumes from a previously announced discovery (see press release dated January 23, 2008) at 11-12-51-5 W5M which tested at 1,400 BOPD (26%-40% W.I.).
The remaining two current Nisku licenses are in the Tomahawk area at 1-16-51-6 W5M (25% W.I.) and 9-17-51-6 W5M (25% W.I.). The 1-16 test involves deepening a well drilled by Great Plains and its partners two years ago which had not been drilled to the Nisku due to licensing issues. This operation is expected to commence in July and will require very little capital given the amount already spent on the well to-date. A successful outcome at 1-16 will set up the 9-17 location as well as provide sufficient reserves for pipeline construction. This in turn would allow for the tie-in of shut-in volumes from existing discoveries at 15-7-51-6 W5M (35% W.I.) which tested at 650 BOPD and
Great Plains and its partner are expecting a license to be granted immediately for the drilling of a new pool test in Crossfire, approximately
Great Plains production averaged approximately 1,975 BOEPD through Q4 with December and January volumes negatively impacted by extreme weather conditions in Northeast BC and mechanical breakdowns at Randell. Production volumes for early February averaged 1,590 BOEPD which reflects the current shut-in of the 9-1 well at Crossfire and the temporary curtailment of approximately 100 BOEPD at Klua, due to line pressure problems for one well which are expected to be resolved in April or May.
While industry conditions require substantial reductions in capital spending, Great Plains remains confident in its ability to execute the
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