KFG Petroleum to Spin Bit in Fayette Field This Week
KFG Resources President, Robert A. Kadane, reported that KFG's wholly owned subsidiary, KFG Petroleum Corporation, has staked location to drill a south offset to Spring Hill No. 1 well in the Fayette Field, Jefferson County, Mississippi.
The Spring Hill No. 1 well had three oil zones and was completed in the upper lobe of the Stewart "A" Sand and put on production in August 2009. An east offset, the Spring Hill No. 2, was drilled and put on production in the 4600-foot Sand in November 2009. The No. 1 and No. 2 wells, combined, have a stabilized production rate of 60-70 barrels of oil per day with the main oil zone in the No. 1 well, the Stewart "A" Sand, still behind pipe.
KFG Petroleum Corporation has approximately 4,100 acres of leases in the area and owns a 100% working interest (79.16% net) in the Spring Hill wells and in this offset location reverting to a 74.9% working interest (59.4% interest) after payout of all drilling, seismic, land, exploration, development, taxes, and operating expenses. The south offset to the No. 1 well, called the Spring Hill No. 5, should be spudded on or about the 12th of March.