Nighthawk Provides Update for Jolly Ranch Project
Nighthawk has provided an update in respect of the Jolly Ranch project, in which it holds a 50% working interest with Running Foxes Petroleum Inc., the operator, holding the remaining 50% interest.
Jolly Ranch comprises both conventional and non-conventional oil producing horizons targeting primarily Pennsylvanian age formations, namely the Marmaton (conventional) and Cherokee and Atoka (non-conventional) shales.
The project covers approximately 370,000 gross acres located in Lincoln, Elbert and Washington Counties, Colorado. In July 2009 Schlumberger Data & Consulting Services ("Schlumberger") reported that the P50, or most likely, oil in place in the three primary formations across approximately two-thirds of the acreage is 1.462 billion barrels gross. In addition, the assessment stated that there is reasonable certainty of reservoir and source rock continuity over the project area and surrounding acreage.
- Jolly Ranch is a potentially world class shale oil project located in the southern part of the Denver Basin
- 13 vertical development wells targeting the Cherokee and Atoka shales (including one well which was sidetracked horizontally), three shallower wells and two salt water disposal wells have been drilled on the project. In addition, an existing production well completed in an Atoka sandstone reservoir has been acquired from the State of Colorado
- The project is producing oil from the Atoka and Cherokee shales at depths of 6,500 to 7,500 feet
- The operator anticipates an upward trend in production from current average test production levels of approximately 150 barrels of oil per day to an initial target of 1,000 barrels gross per day during 2010
- The operator has completed three new 3-D seismic surveys that are presently being interpreted. Re-evaluation of the previous 3-D seismic surveys has indicated a number of conventional targets, basement faulting and areas of potential sweet spots
- Schlumberger has been engaged to complete an extended modelling and reservoir simulation to allow development of production and recovery profiles, with the results to be used as the basis of an independent reserves assessment
- Companies that are actively leasing in the area are Unit Corporation, EOG Resources, Newfield Exploration, Sundance Energy, Wiepking-Fullerton Energy and McElvain Oil and Gas
- As at February 22, 2010 Nighthawk had US $18.3 million in cash and liquid investments and remains debt free
David Bramhill, Managing Director of Nighthawk, said, "Nighthawk's primary objective is to build value around Jolly Ranch, a sizeable low risk, high reward asset. We are focused on increasing production levels, in conjunction with proving up the extent of the asset in order to generate maximum value. We believe that Jolly Ranch can be established as a high value shale play similar to prolific shale projects such as the Bakken, Barnet and others throughout the US Mid-continent. These shale plays can command exceptional exit prices once producibility and economic parameters are exhibited."
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Company: Running Foxes Petroleum Inc. more info
- Nighthawk Settles Claims with Running Foxes (Oct 09)
- Nighthawk New Operator for Jolly Ranch Project (Dec 28)
- Nighthawk Provides Update for Jolly Ranch Project (Feb 23)