Kauri-A2 Well Results Are In

Swift Energy Company's Kauri-A2 well in New Zealand encountered hydrocarbons in the targeted Manutahi sand over an approximate 33-foot (10-meter) interval beginning at a depth of 3,739 feet (1,140 meters). Operations are currently underway to set production casing.

The Kauri-A2 well exhibited strong fluorescence and good mud log shows while drilling. Electric logs indicate excellent porosities and sidewall cores were taken for further analysis. The well came in approximately 23 feet structurally high to the same sands as the Kauri-A1 well. The well will be completed and tested over the next several weeks. Based on its test results, we plan to drill one or more wells next year to more fully develop the Manutahi sand. Mapping of this sand indicates an areal extent of up to 3,000 acres in this and an adjoining fault block.

Testing of the Kauri-A1 well, which was drilled earlier this year, will begin immediately after the testing of the Kauri-A2 well is completed. Initially, the Upper Tariki sand beginning at a depth of 11,126 feet (3,392 meters) will be tested. Following this, three separate intervals will be tested in the Kauri sand, which has a gross thickness of 872 feet beginning at a depth of 9,473 feet (2,888 meters).

Additionally, the Company is currently drilling the Rimu-B3 well to continue the delineation of the Rimu area and prepare for the commencement of full-scale production operations that are expected to begin early next year. The Rimu-B3 well is expected to reach its target depth in the Upper Tariki sand within next few days. The Company anticipates completing and the Rimu-A1 well was shut-in for long-term pressure build-up. The Rimu-A3 well is undergoing limited production testing with a fracture stimulation planned before the end of the year. The Rimu-B1 and B2 wells were also shut-in for long-term pressure build-up. The Rimu Production Station, including the oil and gas separation and processing facilities, is under construction and is expected to be operational early next year.

Terry Swift, President and CEO of Swift Energy Company, noted that "The Kauri-A2 drilled as expected, and we are now in the process of testing to determine the commerciality of the Manutahi sand in the Kauri area. We believe that the development of the shallow Manutahi sand could possibly enhance early cash flow of this project. We have now established several areas for development in New Zealand, including the Upper Tariki sand, the Rimu limestone and the Manutahi sand. We continue to be excited about the potential of the Kauri sand and the deeper intervals of the Lower Tariki and Cretaceous sands at Kauri."