Wavefront reported that Pemex's Samaria-Luna oil production asset has approved four single well Powerwave stimulations pursuant to the non-binding Letter of Intent announced October 27, 2009. The Samaria-Luna well stimulations represent the start of an extensive Powerwave undertaking with Pemex.
A single well stimulation, or work-over, is a remedial operation performed on a producing well to restore or enhance productivity. In many instances a chemical is pumped into the well to stimulate a producing interval. However, during this operation the importance of placing the chemical efficiently is often underestimated. A single well stimulation is generally on the order of one day compared to flooding operations (i.e. water flooding) that can last much more than a decade.
The objective for the Samaria-Luna single well stimulations is to re-establish oil production to levels greater than current rates. As outlined in the October 27, 2009 news release, in the event of successful well stimulations, Wavefront could be awarded a 5-year open, sole source contract to supply Powerwave for well stimulation work done on newly drilled and existing wells across Pemex operations. Wavefront cautions that no such supply contract has been agreed to or entered into. Licensing fees for Powerwave well stimulations in a 5-year open contract are set at US $4,000 per day per well.
"Wavefront is very pleased to have the Samaria-Luna asset approve the Powerwave single well stimulation work as outlined in the Letter of Intent with Pemex," said Wavefront President and CEO Brett Davidson. "Wavefront continues to work with individual Pemex assets to finalize additional agreements for all remaining single well stimulations as well as Powerwave-driven waterflood locations."
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