4th Jun 2014 08:04
LONDON (Alliance News) - Northcote Enrgy PLC said Wednesday that its Zink Ranch Project in Oaklahoma has recorded its first positive initial gross flow rates for the 8-A well at its Zink Ranch project.
The company said that over a two-day test, initial gross flow rates of 11.5 barrels of oil per day and 159 million cubic feet per day were recorded, equating to 38 barrels of oil-equivalent per day, net 10 barrels of oil-equivalent per day.
Northcote said this is the first result from the company's 14 well recompletion programme at Zink Ranch, with results of a further three recompleted wells, alongside longer test production on the 8-A, to be announced in due course.
The onshore US oil and gas exploration and production company is completing and testing each well in series before bringing all four recompleted wells into production as it installs the pipeline and compressor required to support the higher field natural gas volumes.
"By undertaking 14 recompletions at Zink Ranch, Northcote is adopting a portfolio approach to re-disk exposure to any one recompleted well. The programme has been designed to deliver an increase in production and return, which on average over the 14 recompletions will, the Directors believe, significantly enhance shareholder value," said the company.
The Zink Ranch Project is located in Osage County in Oklahoma.
Northcote's Chief Executive Officer Randall Connally said, "At the commencement of the Zink programme, I expected that each of the fourteen wells would contribute an average gross increase in production of 10BOEPD. Therefore, whilst the outcome from each of the 14 Zink recompletions will vary, the 8-A gets the programme off to a strong start.
"Furthermore, the strong production from the 8-A test means we expect the incremental revenues to repay the investment capital on that well in under 3 months further demonstrating the attractive economics of the programme," he added.
Northcote has a 54% working interest in the wells while North American Petroleum holds a 30% working interest.
North American Petroleum Managing Director, Stefan Olivier said that the "initial production from 8-A is above the operator's original expectations and is expected to result in the recovery of costs within just three months. While performance will vary for each individual well, we are nevertheless delighted with the outcome of the first recompletion of an existing well bore on Zink Ranch into a previously untapped payzone."
Shares in Northcote were trading 0.33% higher at 0.918 pence per share Wednesday morning.
By Alice Attwood; [email protected]; @AliceAtAlliance
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