Lynden provided the following update on the Company's Wolfberry and Mitchell Ranch Projects:
The Company's fifth Wolfberry well, completed in mid-July, began to produce oil 21 days ago after first flowing back for several weeks. The well has averaged 80 barrels of oil and 190 mcf of gas per day over the last ten days (63 barrels of oil and 117 mcf of gas per day since the date of first production). Lynden has earned a 33.85% working interest in the well. The ultimate productive capability of the well remains unknown at this time.
Management is encouraged by the initial results from the well and the positive implications for potential development across the 2,026 gross (1,626 net) acre contiguous land package on which the well was drilled. Lynden can earn working interests in this land package which range from 33.85% to 43.75%.
Production from the Company's other four Wolfberry Project wells continues within expected ranges. While production is predominantly oil, the Company continues to receive a premium price for its gas as a result of its high natural gas liquids content. The Company and the project operator are currently making plans for the spudding of 5 additional Wolfberry Project wells before the end of the year.
The Company continues to acquire additional acreage in its Wolfberry Project which now covers approximately 18,000 gross (15,500 net) acres in Glasscock, Howard, Martin, Midland, and Sterling counties of West Texas.
Wolfberry wells primarily target oil (and gas) production from the Spraberry and Wolfcamp formations, which are of Permian age and informally grouped to form the "Wolfberry" interval or zone. Secondary targets are also being evaluated for completion as part of Lynden's Wolfberry Project. Typical Wolfberry wells involve completions over a 2,500 to 3,000 foot gross interval, generally located between 7,000 and 11,000 feet, drilling depth.
Mitchell Ranch Project
Spade Ranch 17 #1, the first Mitchell Ranch Project well, was completed in late July and has been flowing back since the beginning of August. The second Mitchell Ranch Project well, the Spade 14 #1, has been drilled to its target depth of 7,240 feet and a first phase of completions was carried out on August 20th. A second phase of completions is scheduled for late October. The completions have been staggered into two phases to allow for optimal evaluation of the targeted zones.
The Mitchell Ranch Project, acquired in early June, provides Lynden with the option to acquire a 50% working interest in 101,495 gross and net acres located in Coke, Mitchell, and Sterling counties of West Texas. All acreage is contained within a historical ranch that lies to the immediate west of the Jameson oil field and is approximately 10 miles south-east of the Iatan oil field. The Spade 14 #1 is on the eastern side of the property, approximately 4 miles north-west of the Jameson field, and 14 miles east of the Spade 17 #1. The Mitchell Ranch Project is focused on Permo-Pennsylvanian-aged detrital targets along the eastern shelf of the Permian Basin where there are numerous opportunities across several pay zones, all of which are shallower than 8,000 feet in drilling depth.
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