Terax Says Preliminary Results from Barnett Shale Well Encouraging

Terax Energy has completed the vertical section of the company's initial well, the Mitchell #1-H horizontal, on its lease in Erath County, Texas. At this time, the company is drilling the 2,700-foot horizontal section of the well and expects to reach total measured depth of about 6,700 feet within the next two weeks.

Through a log analysis of the vertical section of the well, Schlumberger Logging Services has reported to Terax that the Barnett Shale section in the Mitchell #1-H well appears to contain gas in place and the possibility of hydrocarbons with low water saturation and good permeability.

When the lateral section is completed, Schlumberger will run its FMI log through the horizontal section to capture what is equivalent to a digital picture of the inside of the Barnett Shale reservoir. The FMI log is considered to be some of the latest technology from Schlumberger and will allow Terax engineers, along with BJ Service Co., to design the most appropriate fracturing procedure for the reservoir.

"Terax is pleased with the timely progress on the Mitchell #1-H well, and we are encouraged by the positive reports from Schlumberger," said Andrew Hromyk, director of Terax. "We look forward to the completion phase of this initial well and the advancement of Terax's additional drilling operations in the Barnett Shale formation. Our ability to deliver these results and keep our operations on schedule is a testament to Terax's field employees and contractors."

Terax also has selected four additional well locations in Erath County, and plans to commence drilling of its second well, Mitchell #2-H, in late November, pending the release of the rig from the Mitchell #1-H well.