Contact Exploration Spuds New Development Well at Stoney Creek Field

Contact Exploration Inc. has announced the drilling of a development well in their producing Stoney Creek Field, New Brunswick. The Stoney Creek N-78-2328, which has commenced drilling, will be drilled to a projected depth of 1115 meters and hydraulically fractured to exploit oil production from the existing Stoney Creek Field.

Approval was received on November 14th, 2008 from the New Brunswick Department of Natural Resources to drill Contact Stoney Creek N-78-2328. This vertical well, once drilled, will have a suite of modern wireline logs over the entire interval as well as selected core samples taken from the zone of interest. The acquisition of modern data from the Stoney Creek Field via this wellbore will enable Contact to further verify the reservoir properties of the field. The Stoney Creek N-78-2328 location was chosen in a high pressure section of the field offsetting some of the most productive wells in Stoney Creek. Upon completion of the well, a stimulation treatment using hydraulic fracturing is planned.

As a result of a recent study conducted by the University of New Brunswick, it has been determined that a hydraulic fracture treatment is the most efficient method of exploiting the reserves in the Stoney Creek Field. Drilling this development well and performing a fracturing treatment should enable Contact to optimize future development and infill drilling in the field to maximize production from the reservoir. If this method proves to be more efficient for enhanced production of the oil reservoir, the same method can be utilized for the production of gas from the gas bearing zones in Stoney Creek. The depth of the well will allow penetration through the existing reservoirs and investigation of any conventional or unconventional potential beneath the currently defined targets.

"We have been producing oil from the Stoney Creek field for over a year, and have a better understanding of the reservoir's behavior through production," stated Darcy Spady, President and CEO. "Using production data, combined with the excellent research conducted at the University of New Brunswick by Dr. Laura Romero-Zeron and Mark Bacon, Master of Science Candidate, we can better understand how to effectively deal with this unique hydrocarbon deposit and optimize our recovery techniques."