NuLoch Enjoys Significant Exploration Success and Production Gains
NuLoch Resources experienced great gains in exploration and production in 2007. NuLoch boosted average production to 465 boe/d during part of December 2007 and enhanced oil production to 200 boe/d at Balsam.
The active Q4 2007 drilling program resulted in two natural gas discoveries.
In Q3 2007, NuLoch participated in the drilling of a follow-up well (0.3 net) at Balsam. Combined initial gross productive capability of the two Kiskatinaw wells exceeds 600 barrels of oil per day (34 degree API gravity) necessitating pumping, treating and storage upgrades. That work was largely completed in December 2007 and the first eleven days of optimized production averaged approximately 200 boe/d net to NuLoch.
The Company drilled 4 (3.6 net revenue-interest) wells during Q4 2007.
Two of those wells (2.0 net), located at Enchant, encountered natural gas in highly permeable zones. These wells are expected to add approximately 2.0 mmcf/d to NuLoch's production base when placed on-stream late in Q1 2008.
At Pembina, completion operations are underway in the Mannville on a 60 percent revenue-interest well that may result in a third natural gas discovery attributable to the Q4 2007 program. There is an additional up-hole zone of interest.
One (1.0 net) well drilled in Q4 2007 was dry and abandoned.
At Enchant, the Company is currently evaluating potential follow-up locations on two sections of option land (65 percent revenue-interest) offsetting one of the Q4 2007 exploration discoveries.
At Little Bow, pursuant to a one section farm-in, NuLoch intends to drill an 1100 m well (50 percent revenue-interest) targeting known Glauconite oil reservoirs. The Company shot 3D seismic over the farm-in lands in Q4 2007 and has options to drill additional locations if successful.
At Pembina, Nuloch has earned two sections of land with options on two additional sections with multi-zone potential. An additional section of land (60 percent working interest) was acquired at a recent Alberta land sale. Depending upon the results of completion operations described above, the Company may drill wells on this new exploration project.
At Farrow, NuLoch has an option to drill a well (70 percent revenue-interest) based upon an on-going evaluation of 3D seismic shot late in Q4 2007. The target is light oil and natural gas in the Glauconite.
The Company has 25 (25.0 net) shallow natural gas development locations at Enchant that have been deferred given high service industry costs and recent commodity pricing trends. These locations can be drilled and brought on-stream quickly if those external parameters improve.