PetroNeft, owner and operator of Licenses 61 and 67, Tomsk Oblast, Russian Federation, provided an update on its operations at License 61.
Construction of production facilities has been completed and production has gradually been commenced from four wells. Field production has been 1,100 bbls of oil in the first two days of production and flow rates are expected to increase as drilling fluids are cleared out and the electric submersible pumps are optimized. Three additional wells will be brought on production over the coming week.
Eleven wells are scheduled to be on production at the end of the year and we anticipate meeting our year-end production target of 4,000 bopd. In January 2011, when a crew can be mobilized on winter roads, a program of hydraulic fracture stimulation will commence in order to achieve the maximum production levels and enhance oil recovery.
Current oil production is being used to complete the commissioning of the oil processing facilities and is filling the oil storage tanks at the facilities site and will commence filling the 60 km pipeline to the Kiev-Eganskoye transfer point shortly.
Drilling of the seventh of the planned nine production wells at the Lineynoye oil field has now been completed ahead of schedule. Preliminary log and survey data indicate that the well encountered the thickest net pay to date in the development program.
The well was drilled in 14 days which is the fewest days yet in the current development drilling program.
Production casing has been run in the well and cemented. The drilling rig has been moved along its rails and drilling of the eighth well has commenced.
Dennis Francis, Chief Executive Officer of PetroNeft, commented, "We are delighted to announce that the Lineynoye Phase 1 project has achieved first year-round oil production. This has been a monumental accomplishment achieved in less than one year of the funding for the project. We owe special thanks to our Tomsk staff for their hard work, professionalism and planning to make this project a reality. The commencement of production is a transformational milestone for PetroNeft and provides a tremendous platform from which the Company can position itself for future growth."
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