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LEDUC-WOODBEND - BLAIRMORE ZZZ POOL DEVELOPMENT
BLAIRMORE ZZZ POOL HIGHLIGHTS
- High working interest, operated
- Current production ~321 bbl/d and 1.4 MMcf/d
- Recent drilling and workover successes
- Multiple follow-up locations
- Minimal surface disruption – pad drilling from existing leases
- Waterflood implementation estimated at 12.8% recovery
POOL HISTORY
The Blairmore ZZZ Pool was discovered in 1951 with the 16-16-051-26W4/3 well. The pool was not produced until 1999 when 16-16 and three additional wells were completed and placed on production. These wells recovered 137 Mbbl to December 2009, prior to additional development by the Company. Current cumulative production is 184 Mbbl with 47 Mbbl being produced during 2010 from the recompleted and fracture stimulated wells 06-16, 15-16 and 16-16.
The pool is centered on a north – south trending high structurally controlled by the Devonian reef topography below, with a mapped area of over 2,500 acres. The average net pay and porosity are 5 m and 15%, respectively, resulting in a Company calculated original oil-in-place (OOIP) of over 27 MMbbl. There is some uncertainty as to the oil/water (O/W) contact and as a result Sproule has reduced the net pay they recognize and consequently the OOIP to approximately 10 MMbbl. Production to date represents ~1.7% oil recovery. The Company’s mapping based on the Sproule recognized O/W contact of -657.6 m is shown on the next page.
RECENT WORK
Recently the Company has had excellent results developing the Ellerslie E sand (the producing zone in the Blairmore ZZZ pool) and believe there are significant further development opportunities. The pool is also an excellent candidate for waterflood implementation.
Over the last 12 months the 15-16 and 16-16-051-26W4 wells were recompleted with fracture stimulations resulting in a combined IP rate of over 300 bbl/d of light, 37° API oil. Currently the wells have a combined rate of 180 bbl/d with very little water.
The 02/09-16-051-26W4 well was drilled in December 2010 and flowed ~50 bbl/d of oil for two and a half months, however it is currently shut-in due to ongoing drilling on the lease. Production volumes are expected to increase when artificial lift is installed.
2011 ACTIVITY
In March and April 2011 two wells were drilled directionally from the 09-16 surface location to bottom hole locations at 102/12-15 and 102/08-16.
The 102/08-16-051-26W4 well was drilled through the Ellerslie and into the Nisku. The Nisku Formation looks prospective and the Company has decided to complete and fracture stimulate the zone by the end of April. A second well may be required for the Ellerslie.
The 102/12-15-051-26W4 well has been drilled and logged and is awaiting completion. Completion plans are being finalized and are expected to be carried out by the end of April. Successful oil production will be significant as it would establish a new oil/water contact extending the pool boundary beyond the Sproule recognized area. This will validate peripheral locations originally planned by the Company but not recognized in the Engineering report. The presence of down structure oil in Section 15 has already been indicated with recovery of 411m of oil on DST in the 14-15 well. Should 14-15 be an extension of the Blairmore ZZZ Pool, there is potential for up to 41 additional drills/recompletions to fully develop this pool on 40 acre well spacing. Recompletions will be done where possible and all new locations will be drilled from existing leases.
Of the total possible 41 wells, Sproule has recognized nine drilling locations and five recompletions in addition to the existing four producing wells.
WATERFLOOD
Regionally, Mannville sands have responded well to waterflooding and the Company has plans to implement a peripheral flood in the Ellerslie E sand. A model has been developed to demonstrate this potential based on a regional average incremental recovery of 12.8%. The model was limited to the Sproule recognized pool development. Based on Sproule’s OOIP estimates and a 12.8% incremental recovery factor, additional reserves of 1,339 Mbbl gross and 1,115 Mbbl net to the Company would be realized from the waterflood. The corresponding incremental before tax net present value, discounted at 10% is $33.7MM. Eight additional wells will be required for water injection.
