"Our primary activity is in Oklahoma where we use Bubble Point Technology to extract residual oil, gas and natural gas liquids from the Hunton Resource Play. In addition to the Hunton being a very large opportunity for Petroflow, the use of Bubble Point Technology has resulted in the steady increase of our production rates and we are most pleased to report this to our shareholders", stated Mr. Sandy Andrew, President and COO of the Company.
The estimated peak production rate for the month of April 2009 was 4,046 BOEs (24,276 MCFGE) per day. April 2009 averaged approximately 3,727 BOEs (22,362 MCFGE) per day of production. Our average production for the month of April has grown by approximately 2% over March, even though no additional wells were put on stream in April. Approximately 31% of the production was oil
"The Hunton represents a low risk enterprise for Petroflow since we use Bubble Point Technology to recover a resource that is already identified. With the excellent production performance we are experiencing and the decrease we have been able to achieve in capital costs, this play still provides tremendous upside opportunity for Petroflow, even with current forecasted commodity prices."
The Hunton Resource Play in Oklahoma has an areal extent of approximately 16 million acres. Assuming 10% of the land is prospective, the resource potential could be as high as 6.2 Tcfe.
Starting in February 2009, Petroflow began to report natural gas liquids ("NGL") volumes from its Oklahoma operations in accordance with the new forms of midstream processing contracts. This change has resulted in an approximate initial increase of five percent in Petroflow's barrel of oil equivalent volumes. In the second quarter of 2009, as a contract revision takes effect, an additional increase of approximately three percent will occur. The midstream contracts which prompted the reporting change provide direct compensation for NGL volumes. The new prices have been staging into effect since the agreements were finalized in May 2008 and will continue to phase in during the first half of 2009. The full reserves value of these positive changes is reflected in Petroflow's year end 2008 reports.
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