Basic Earth Science Systems reported that drilling operations are underway on the second of two Bakken wells in McKenzie County, North Dakota. Along with its partner, ConocoPhillips, Basic Earth is currently drilling the King's Canyon #21-27H well in Section 27, T151N-R96W, a new area of interest in McKenzie County for Basic Earth. This well has a single long lateral borehole spanning Sections 27 and 34. Basic Earth has an approximate 1.13% working interest and expects to spend approximately $64,000 for its drilling and completion cost in this well.
In addition, completion operations are currently underway on our newly drilled Lassen #41-26H, located in the adjacent sections. This well also has a single long lateral and spans Sections 26 and 35. In this well, Basic Earth has an approximate 0.114% working interest and expects to spend approximately $8,000 in this endeavor. ConocoPhillips will operate this well in addition to the King's Canyon well.
"The successful drilling of the Lassen, our newest horizontal Bakken well should yield production data by the end of November, and drilling operations are progressing favorably on the nearby King's Canyon well," said Ray Singleton, President. He added, "These two wells are our fifth and sixth in the Bakken/Three Forks trend in North Dakota."
Singleton continued, "Twenty miles to the southeast of the Lassen and King's Canyon, we continue to hold Bakken/Three Forks acreage in the Banks Prospect. With oil prices fluctuating in the high $60s to low $80s, we are hopeful that our partner in this prospect will resume drilling next quarter with as many as three additional wells. If drilling resumes, Basic Earth anticipates spending up to $360,000 per well and have a working interest as high as 6.5%."
In addition to the Banks Prospect efforts, Basic Earth is planning to drill three more wells before the end of 2009 and expects to have more information on these ventures as they develop. If all six of these wells are drilled, the Company expects to capitalize another $1 to $2 million in expenditures before the end of our fiscal year.
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