Our newest partner Entek has been drilling both on Slater Dome and the Focus Ranch. Here is their latest summary of Niobrara results. More to come, but for once it does look encouraging.
BUTTER LAKE 32-10 & NIOBRARA CONTINUOUS OIL PLAY UPDATE
Entek Energy Limited (“Entek” or the “Company”) advises that the Butter Lake 32-10 well (“32-10”)
has flowed hydrocarbons during initial cleanup. Further details are set out below.
Butter Lake 32-10 (32-10) Update
• The well has been flowed for initial cleanup, and is now shut in as the rig moves off location. Since
being shut in, the well has shown further indications of influx, with increases in wellbore fluid level
and well head pressures.
• Further cleanup of the well is likely to be required before a stabilized flow can be determined.
Testing and analysis will continue over at least the next two weeks.
• Entek is cautiously optimistic with the results of the 32-10 well to date and is continuing its testing
and analysis program.
Niobrara Oil Resource Play Update
The Butter Lake 32-10 well represents the fifth well in Entek’s Niobrara Continuous Oil Play, all of which have
encountered hydrocarbons. All five wells are being reviewed to optimize completions to maximize
production potential.
Although the Niobrara Formation has been producing from vertical wells for decades it is commanding
industry attention of large oil and gas companies as a result of significant recent production outcomes and is
currently one of the most sought after and prospective oil resource plays.
Entek engaged the services of Dr Thomas Ahlbrandt* to evaluate the prospectivity of its Niobrara
Continuous Oil Play within its portfolio. The following are comments from his report.
Three continuous Upper Cretaceous oil resource plays (Niobrara, Mancos and Carlile (Basal
Niobrara) exist on Entek acreage and are productive in the region.
The Niobrara is thick, 900-1,800 feet and has a higher detrital composition relative to the DJ Basin —
good for enhancing brittleness (fracability). The shales are fractured in response to their tectonic
setting related to regional shear zones and extension.
The recent U. S. Geological Survey (USGS) assessment of the recoverable oil from the Niobrara
Continuous Oil Play, where Entek is focused, is about 2.5 times that of the Niobrara Continuous Oil
Play in the DJ Basin where there is the current industry focus.
Vertical testing and additional rock parameters are needed prior to attempting a horizontal well
which will most likely be in the Niobrara. Entek now has five key wells across its acreage to
undertake this work.
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The resource potential of the Niobrara Continuous Oil Play has been assessed by the USGS to have
more potential than the Niobrara oil resource play in the DJ Basin.
Entek is conducting a prospective resource study across its Niobrara Continuous Oil Play acreage utilizing the
five key wells described above and adjacent analogue wells from Anadarko’s Sierra Madre Field which has
been in production since the early 1990’s.
* Dr. Thomas S. Ahlbrandt – Career Summary
Dr. Ahlbrandt is a globally recognized petroleum geologist with over forty years of experience in oil and gas
exploration, research and assessment. He has over twenty years of experience with major and independent
oil companies and another twenty years of service with the U.S. Geological Survey (USGS). In industry he has
served in many capacities including CEO and Vice President of Exploration and Chief Geologist at companies,
and has discovered petroleum in four basins both in the U.S. and internationally at previous positions. At the
USGS he managed geoscience groups ranging to 350 employees and from 1987-2006 held senior energy
management positions in the USGS both at their headquarters in Reston, Virgina from 1987-1991 and from
1991-2006 at their regional office in Denver, CO. He is an internationally recognized expert on petroleum
focused in the Middle East, North Africa, Alaska and the Rocky Mountain region as demonstrated by his 235
publications. His global experience includes major organizations including currently serving as a Vice
Chairman of a United Nations Committee (Ad Hoc Group of Experts on Reserve and Resource Terminology),
AAPG, and the USGS where he was the USGS World Energy Project Chief assessing the oil and gas potential
of the world. This major work was published both by the USGS and as Memoir 86 of AAPG (senior author).
He has presented many papers to organizations including OPEC, IEA, EIA, and AAPG and many media outlets.
He has numerous awards from AAPG, RMAG, USGS and the University of Wyoming.
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BUTTER LAKE FEDERAL 32-10
The well targeted the Niobrara Formation and Frontier Formation within the Focus Ranch Unit.
The Total Depth (TD) was 8,830’ within the Frontier Formation, which has tested gas and liquid hydrocarbons
from the Focus Ranch 12-1 well.
The well targeted a closed structure bounded by a fault to the north with structural reversal at shallow levels
including the Deep Creek Sand. The Mancos Shale also exhibits structural closure that would create
potential hydrocarbon traps in the Shannon Sand and Marapos Sand (that are units within the Mancos
Shale). The deepest reservoir that was penetrated within structural closure was the Frontier Formation.
Within the Niobrara Formation primary target there are three brittle benches (or ‘units’) that act as
continuous hydrocarbon reservoirs when fractured. Fracturing of these benches is expected to occur
associated with faults, igneous sill intrusions and the structural deformation at this location.
The average production rates for Niobrara wells throughout the Sand Wash Basin where Entek’s acreage is
located are 101 BOPD and 165 MCFD. Estimated Ultimate Recovery (EUR) for those averages are 260,000
BO and 1.1 BCF per well. Initial production rates have been as high as 500 BOPD from vertical wells adjacent
to Entek’s acreage. The Focus Ranch 12-1 southeast of this location had combined initial rates of 2.75
MMCFD and 240 BOPD. Independent reserves estimate associated with the 12-1 well range from 2.6*
MMBO to 3.2** MMBO of condensate and oil and 7.6* BCF to 20** BCF of gas.
* Based on a report by American Energy Advisors (Feb 2009). The report
assumes 12 wells will be required to produce the reserves.
** Based on a report by APEX Petroleum Engineers (Oct 2008) and assumes
an estimated GOR of 6250 from tests performed at the Focus Ranch 12-1
well. The report assumes reserves associated with one 320 acre section.
GLOSSARY
A$ Australian dollar
BCF Billion cubic feet (of natural gas)
BOPD Barrels of oil per day
MCFD Cubic feet of gas per day x 1,000
MMCFD Cubic feet of gas per day x 1,000,000
MMBO Barrels of oil x 1,000,000
US$ United States dollars
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FOR FURTHER INFORMATION
RUSSELL BRIMAGE - CHIEF EXECUTIVE OFFICER
+ 61 8 9213 4388 INFO@ENTEKENERGY.COM.AU
Competent Person’s Statement:
Information in this report that relates to Hydrocarbon Reserves and or Resources is based on information compiled by
Mr Russell Brimage, Chief Executive Officer of Entek Energy Limited who has consented to the inclusion of that
information in the form and context in which it appears. Mr Brimage has over 30 years experience in the application of
engineering to the petroleum industry in oil and gas exploration and production, both in Australia and internationally,
as either an employee or consultant to oil companies operating in the upstream petroleum industry. Mr Brimage
directs the Company’s operations with the help of various professional consultants, appropriately qualified and
experienced in their respective fields within the upstream petroleum industry. He is also an Associate Member of the
Society of Petroleum Engineers.
AI
