American Petro-Hunter has announced the seismic shoot at the Sacramento Gas Project is set to commence on July 15th.
The 5 mile long, 2D swath of seismic data is essential in order to finalize the positioning of the first test well planned for later this summer. The contract with the seismic company is signed and, as announced earlier, American Petro-Hunter is carried turnkey through the shoot, interpretation and reprocessing of the data as all costs involved were included in the acquisition payment. The seismic information will be available approximately two weeks after the completion of the shoot at which time a review and assessment of the data will determine the location of the first well.
The project is located west of Modesto in the Central Valley of California, near Sacramento. Potential Recoverable Reserves have been calculated to be 42 BCF at a depth of 7,400 feet within sands that are indicated by 2D seismic to be in excess of 50 feet of gross pay. The Company has acquired a 25% Working Interest in the project.
Estimates by the play generator, a private third party engineering group, is that if the pay zone is 100% gas filled and the well is brought into commercial production that an I.P.R. (Initial Production Rate) of 5,000 Mcf per day may be achieved. American Petro-Hunter would anticipate similar rates to commercial wells in the region at analog fields that produce on a daily basis of between 2,000 to 4,000 Mcf per day. Natural Gas wells in these analog fields exhibit long life with relatively stable rates of production and predictable decline.
The Central Valley in the Sacramento region of California is called "California's Gas Country" and nearby fields contain some of the most prolific gas reservoirs in the Sacramento Valley. They have accounted for over 400 BCF of gas production to-date. In proximity to the prospects are prolific gas fields such as Union Island (271 BCF), McMullin Ranch (63 BCF) and Vernalis (103 BCF). The project, if commercially viable, would produce gas that would be purchased by such groups as PG&E Citygate, which supplies gas to the Capital region of Sacramento and is used in electrical power generation in the area. The current gas pricing for PG&E Citygate is $3.25 per Mcf.
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