Contact Exploration Continues Success With Kakwa Liquids-Rich Montney Development
CALGARY, ALBERTA--(Marketwired - Oct. 16, 2013) - Contact Exploration Inc. ("Contact" or the "Company") (TSX VENTURE:CEX) is pleased to announce that the fourth Contact-operated horizontal Montney well at 5-23-63-6 W6 (the "5-23 Well") (Contact 25% working interest) has been successfully completed and tested. The well was flow-tested for approximately 170 hours. During the final 24 hours of flow-back the well produced against anticipated gathering system pressure of approximately 2,000 kPa and averaged gross production rates of 1,433 boe/d consisting of 815 bbl/d condensate and 3,704 mscf/d natural gas (204 bbl/d and 920 mscf/d, or 358 boe/d combined, net to Contact).
The 5-23 Well continues to demonstrate a high ratio of condensate to natural gas production from the Kakwa Montney play, flowing at an average 195 bbls of condensate/mmscf during the entire test. The total drill depth of the 5-23 Well was approximately 70 to 100 meters vertically deeper and two miles further west than any other Contact-operated Kakwa well. The confirmation of liquids-rich gas prospectivity in the Middle Montney further to the west on Contact's East Kakwa lands extends the scope and magnitude of the Company's East Kakwa project.
The Company advises that although the initial rates from the 5-23 Well are very encouraging, production test results are not necessarily indicative of long-term performance or of ultimate recovery from the 5-23 Well. Going forward, Contact plans to release 30 day initial production rates from additional wells drilled at Kakwa, the results of which are expected to be more reflective of longer term performance.
Facilities and pipeline work will begin immediately to provide for tie-in of production from the 5-23 Well into Company-operated infrastructure, including the 16-7-63-5 W6M compressor station and condensate stabilization facility ("16-7 Facility"). Construction of the 16-7 Facility continues on schedule for facility start-up in December 2013.
Contact continues to make improvements to the design of its operated wells at Kakwa. The Company's fifth operated Kakwa well at 16-25-63-5 W6M ("16-25 Well") was spud on September 10, 2013 and reached a total depth of 4,680 meters after 33.5 days of drilling, representing a 25% reduction in drilling time from other Contact-operated Kakwa wells. Production casing is now being run in the 16-25 Well, with rig release expected in the very near term. Contact expects to begin completion operations on 16-25 Well in November 2013.
Contact has entered into a one year contract with a drilling contractor, securing a drilling rig for use in Kakwa. The Company intends to utilize this rig to spud its next 25% working interest Montney well to drill from a surface location at 16-8-63-5 W6M with a bottom hole location at 16-17-63-5 W6M in November 2013.
About Contact Exploration Inc.
Contact Exploration Inc. is a public oil and gas company which has a long-term history of operating in Atlantic Canada and has recently demonstrated success in Alberta's liquids-rich Montney Formation tight gas play. For more information, please see the Company's website: www.contactexp.com.
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