Monday, December 27, 2010

PetroBakken Energy Ltd.: Cardium Shale Update

By Andrea:

PetroBakken Energy Ltd. (PBN.TO) recently provided an update on results from their horizontal drilling program in the Cardium formation in Alberta at Pembina, Garrington, and Lochend.

PetroBakken's activity levels have continued to increase and they now operate 10 drilling rigs in the Cardium play with one full time completion crew and two other completion crews on an intermittent basis. With this operating configuration they will be able to accelerate completion and tie-in operations so that by the end of the first quarter of 2011 they expect to be on a normal operating cycle with approximately 10 to 12 wells waiting to be completed and brought on production at any time.

In the month of November, Petrobakken brought 8 (7.0 net) operated wells on production. Through the first sixteen days of December, they placed a further 8 (5.9 net) wells on production, and they anticipate that over the balance of December, they will add another 14 (12.2 net) operated wells. For November and December, they expect to bring a total of 30 (25.1 net) Cardium wells on production.

PetroBakken now has 11 operated wells completed with slick water fracture stimulations that have sufficient history to provide both 7 day and 30 day initial production data. The average initial 7 day production rate from the first 13 wells is 415 bopd, and the average initial 30 day production rate from their first 11 wells is 245 bopd. These results continue to meet their original expectations for productivity from Cardium horizontal wells, and they anticipate further improvements in productivity and capital efficiencies from their drilling and completions operations as they continue to refine their methodologies.

PetroBakken previously reported initial production data from the time that the well is put on production exclusive of the initial flowback or testing period. However, the oil produced from the initial flowback period is sales oil, and although these reported volumes are initially field estimates, once the volumes are reconciled with sales receipts these volumes are now included in their 7 day and 30 day initial production data. In the future, as pipeline projects evolve, PetroBakken expects to conserve more natural gas and natural gas liquids and include those volumes in the reported results.

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