18th Sep 2014 08:14
LONDON (Alliance News) - Caza Oil & Gas Inc saw its shares rise Thursday after it reported strong results from the first well drilled on the Broadcaster property in New Mexico, and said wells being drilled on two other properties in the same state are on track.
The company said the well drilled on the Broadcaster property reached intended measured depth of about 15,818 feet and was fracture stimulated in 40 stages over the past 10 days. It said production rates are steadily increasing under controlled flowback, and the well produced at a 24 hour gross rate of 2,621 barrels of oil equivalent on September 17. That was made up of 2,062 barrels of oil and 3.36 million cubic feet of natural gas.
"This is a very strong well, and the company anticipates a higher peak rate to be achieved in the coming days. Once a peak rate is achieved, the market will be updated accordingly," it said in a statement.
Caza has a 25% working interest in the well and the Broadcaster property as a whole. It already has facilities in place on the property and said oil and natural gas are flowing to sales.
It added that the find in the well, called the 29-3H well, indicates the presence of oil and natural gas across the same potential pay intervals at adjacent property West Copperline. The well had tested the 3rd Bone Spring pay interval, and Caza thinks the the deeper Wolfcamp formation on the property is also prospective for oil and natural gas.
"As stated previously, frac technologies continue to improve in the Bone Spring Play without a material increase in cost. When using these technologies to tailor fracs for specific reservoir characteristics, as in this case, the results can be impressive," Caza Chief Executive W. Michael Ford said in a statement.
The company also said that a well testing the Bone Spring pay on the Lennox Property in New Mexico is currently drilling ahead at approximately 15,289 feet measured depth to an intended total measured depth of approximately 15,740 feet. It expects to hit total measured depth Thursday and has scheduled fracture stimulation for October 6. It has a 50.0% working interest in this well and property.
At Marathon Road in the same state, where Caza has a 14.7% working interest and about 12.5% net revenue interest, the operator has moved a rig into place and is preparing to start drilling the Marathon Road 15 OB Fed #1H horizontal Bone Spring well.
This well is a direct offset to the 15 PA Fed #1H horizontal Bone Spring well, which had an initial 30 day average of 1,974 gross barrels of oil equivalent, consisting of 1,721 barrels of oil and 1.52 million cubic feet of natural gas, Caza said.
Caza Oil & Gas shares were up 9.2% at 19.67 pence Thursday morning, one of the best performing stocks on the AIM All-Share index.
By Steve McGrath; [email protected]; @stevemcgrath1
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