Delta Oil & Gas Acquires First Oil Prospect in Southeastern Saskatchewan
Delta Oil and Gas, Inc. has entered into a farm-in agreement with Texalta Petroleum Ltd., a well established operator in southeast Saskatchewan. The company has agreed to participate for 15% before payout and 7.5% after payout in a proposed four oil well horizontal drilling program in the Wordsworth area. This area is known for prolific oil reserves in numerous Mississippian Alida pools where horizontal wells can prove initial production rates up to 200 barrels of oil per day and generate up to $2MM cash flow in less than two years. As a consequence with oil sales prices currently at $75/bbl (Cdn.), payout of one well investment of approximately $1MM could be only a few months with up to 10 years of additional production life. It is anticipated that the first well will spud within the next 2-3 months subject to drill rig availability. Depending on the success of the first well, additional step-out wells may be drilled.
The first well is to be drilled horizontally for up to 2,000 meters adjacent to existing abandoned borehole with apparent missed oil pay zone in a thick oil-stained porous dolomite reservoir. Based on independent well log appraisals, this potential pay zone could prove a new oil pool with up to 4 million barrels recoverable oil.
Delta Oil and Gas is a growing exploration company focused
North American oil and natural gas reserves. The Company's
current focus is
on the exploration of its land portfolio comprised of working
highly prospective acreage in the Southern Alberta Foothills
interest in the Cache Slough Project in California, its
interest in the
Strachan Prospect, its interest in its Mississippi prospect
and its newest
interest in a horizontal oil well in Saskatchewan. Delta
Oil & Gas is
seeking to expand its portfolio to include additional interests
and the USA.