Winstar Resources Ltd.
WIX-TSX-V
December 21, 2006
Winstar Releases Updated Production Data from its Southern Tunisian Chouech Es Saida #5 and Chouech Es Saida #7 Wells
CALGARY Winstar Resources Ltd. today updated its production data released on November 29, 2006 from its 100% net working interest, operated Chouech Es Saida #5 well (CS #5) recompletion and released new production data from its workover at its 100% net working interest, operated Chouech Es Saida #7 well (CS #7) in Southern Tunisia.
Subsequent to the November 29, 2006 news release, at CS #5 the Company removed obstructions in the production tubing or flow string and conducted a production test over the zone which had recorded a preliminary stabilized flow rate of 130 cubic meters per day ("m3/d") or 820 barrels of oil per day ("bopd") on a 14/16 inch choke. While recovering the perforating debris and other downhole obstructions from the tubing, the CS #5 well was produced at flow rates ranging from 100 to 150 m3/d or 629 to 943 bopd, to the central production facility at Winstars (100% working interest) Chouech Es Saida Concession.
Upon the successful termination of fishing operations, downhole pressure gauges were installed and a production test of the zone within the Triassic Trias Argilo-Greseux Inferieur (TAGI) Sandstone Formation was conducted. During that production test the well recorded a final stabilized rate of 146 m3/d or 918 bopd, of 41 degree API gravity crude with no trace of water production, on an 18/64 inch choke with a flowing wellhead pressure of 95 bars or 1380 pounds per square inch (psi).
The well was subsequently shut in to acquire build-up pressure measurements. The final analysis of the down hole pressure data is expected in January 2007.
Following the shut-in period the CS #5 well was re-started and is currently flowing to the central production facility at a stable rate of 163 m3/d or 1025 bopd with associated gas production of approximately 30,000 m3/d or 1,064 thousand cubic feet per day (mcf/d).
Winstar is producing and selling crude oil from Chouech Es Saida at a corporate record rate and is currently in negotiations with the Tunisian Company of Electricity and Gas (Societe Tunisienne de lElectriciti et du Gaz or STEG) to permit natural gas sales. The engineering and sourcing of key equipment to allow gas sales is underway. The Company is hopeful that it will be begin producing and selling approximately 100 to 200 barrels of oil equivalent (boepd) of natural gas into the Tunisian domestic market sometime in February or March 2007.
Natural gas and oil are anticipated to be sold from the Chouech Es Saida Concession at prices comparable to the Company average price received during the nine months ended September 30, 2006 in Tunisia being $72.48 per barrel of oil and $7.68 per Mcf of natural gas.
On December 15, 2006, the Company finished reactivating the CS #7 well by installing a new and larger down hole electric pump and cable. The well has been shut-in since September 21, 2006 when the original, smaller down hole pump failed. Prior to that failure the well was producing 24 m3/d or 150 bopd.
The CS #7 well with larger pump capacity is now capable of producing an estimated 41 m3/d or 258 bopd. Further to reactivation of CS #7, the well had to be shut-in, due to transportation limitations along the Companys 100% working interest and operated 80 kilometre 6 inch sales or export pipeline connecting Chouech Es Saida north to El Borma. The Company is replacing three small triplex pumps capable of delivering a maximum of 1069 bopd with one large triplex pump with a design capacity of 3,000 bopd. This modification is expected by year end 2006, at which time the CS #7 well will once again commence production.
Winstar is currently producing (and selling) some 2,350 boepd (Canada 550 boepd, Tunisia 1,200 boepd and Hungary 600 boepd) and anticipates it will exit the year at 2,900 boepd (Canada 500 boepd , Tunisia 1,700 boepd and Hungary 700 boepd).
About Winstar
Winstar Resources Ltd. is Calgary-based junior oil and gas company, which explores for, develops, produces, and sells crude oil, natural gas liquids and natural gas in (Alberta) Canada, Tunisia and Hungary. Winstar's common shares trade on the TSX Venture Exchange under the symbol WIX.
BOE
References herein to boe mean barrels of oil equivalent derived by converting gas to oil in the ratio of six thousand cubic feet (Mcf) of gas to one barrel (bbl) of oil. Boe may be misleading, particularly if used in isolation. A boe conversion ratio of 6 Mcf:1 bbl is based upon an energy conversion method primarily applicable at the burner tip and does not represent a value equivalency at the wellhead.
