17th Apr 2014 07:46
LONDON (Alliance News) - Nighthawk Energy PLC Thursday said it has made a new oil discovery at its Snow King 13-33 exploration well, close to its major Arikaree Creek oil field in Colorado.
The oil and gas exploration and production company, which operates in the US, said the Snow King 13-33 well started production on April 12 from the Mississipian Spergen formation with an initial production rate of 300 to 400 barrels of oil per day.
The company said the discovery is a landmark moment and has the potential to open up the basin to full scale development programme similar to its Arikaree Creek operations.
Nighthawk said planning of the next step on site is currently underway, which includes permitting of additional wells and laying out of a 3D seismic program to further define the geological setting before initiating a full scale development plan.
The company also said total production in the the first quarter ending March 31 was 157,355 barrels of oil with an average production of 1,748 barrels per day, a vast increase from total production of 28,175 barrels of oil at 313 barrels per day average the previous year.
Nighthawk did note that its average production was 1,885 barrels per day in March despite being affected by a planned three day shut-in of its Steamboat Hansen 8-10 well for routine pressure build-up tests.
The company said production in the second-half of April and beyond will be boosted by production from the Snow King 13-33 well and by increased volumes from the Pennsylvanian formations in its John Craig 1-2 well.
Nighthawk said the drilling of Salt Water Disposal well at Arikaree Creek has been completed which should reduce its water handling costs by up to USD3 per barrel of produced water moving forward.
The company said its drilling schedule for the Arikaree site has been reviewed in light of the discovery and the next phase of drilling is now likely to start in late May.
Nighthawk said further drilling and development will be facilitated by revised repayment terms for Nighthawk's existing loan facilities with Fastighetsaktiebolaget Korpralen and Kattrumpan Fastighets AB.
Nighthawk Energy shares were up 6.9% to 12.83 pence, putting it in the top ten AIM risers in early trading Thursday.
By Tom McIvor; [email protected]; @TomMcIvor1
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