Resaca Inks Multi-Well Drilling Contract for Cooper Jal Property
Resaca Exploitation, Inc. has announced details of progress made in the implementation of its development plan for its properties in the Permian Basin of West Texas and New Mexico, progress on potential acquisitions, and other company news. Resaca concluded a successful flotation on the AIM market of the London Stock Exchange on July 17, 2008.
The following is a summary of Resaca's progress to date on the implementation of its development plan:
- The Company has signed a multi-well drilling contract to drill infill wells on its Cooper Jal property. The contract is for an initial 10 well program and is renewable at the Company's option in 5 well increments. Resaca spudded the first well in this program on August 29, 2008. The wells will be drilled on ten acre spacing and each is expected to take approximately 15 days to drill and complete.
- The Company has also initiated a 20+ well workover program on its Cooper Jal, Penwell Complex, and McElroy properties. Permian Basin Well Services, LLC has provided the workover rigs for this program to date.
- Resaca has engaged Avasthi & Associates, Inc., a Houston-based petroleum consulting firm, to perform an in-depth CO2 feasibility study on the Company's Grand Clearfork Unit. The Company has already held preliminary discussions with a CO2 supplier who could supply CO2 to the field. Subject to the outcome of the feasibility study, Resaca could commence tertiary recovery on the Grand Clearfork Unit significantly earlier than originally projected.
- The Company has commissioned Williamson Petroleum Consultants, Inc. to conduct a field-wide development study of its Iatan Field. The study is expected to be complete by the end of September.
- The Cooper Jal waterflood optimization efforts continue. The Company has completed the thirteen well clean-out program it began earlier this year and plans to re-enter and convert another abandoned well to a make-up water source well to increase the amount of water injected at the property.
The Company is continuing discussions with several parties regarding potential acquisitions of new projects both within and outside the Permian Basin. The Company has conducted additional analysis on several of the properties in question.
- In mid September, the Company plans to issue a July 1 2008 oil and gas reserve report.
- John J. ("Jay") Lendrum, III, Chief Executive Officer, will present at the oilbarrel.com Conference on September 18, 2008 in London.
- J.P. Bryan, Chairman of the Board, will present at RBC Capital Markets' Oil Conference on October 9, 2008 in London.
Jay Lendrum, Chief Executive Officer, said, "We are pleased with our progress to date in the implementation of the development plan we set out at the time of listing on AIM in July 2008. In addition, we are hopeful regarding the prospect of accelerating our CO2 injection program on the Grand Clearfork Unit, which would be far ahead of the 2011 timeframe we set out originally. Finally, the analysis of the Iatan Field could produce exploitation projects on that property that we had not previously identified.
"On the acquisition and joint venture front, our discussions to date with prospective sellers and joint venture partners have been productive. We have been presented with several interesting acquisition targets that we are diligently evaluating."