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| February 8, 2011 |
| Open Range Energy Corp. Announces Strong Test Results for Its Second Wilrich Horizontal Well at Ansell/Sundance |
CALGARY, ALBERTA--(Marketwire - Feb. 8, 2011) - Open Range Energy Corp. ("Open Range" or the "Company") (TSX:ONR) is pleased to announce successful completion operations and the tie-in of its second 100 percent Wilrich horizontal well at the Company's core Ansell/Sundance Deep Basin property at an initial production rate of 7.0 mmcf per day plus natural gas liquids (NGL). Two drilling rigs are currently operating at the property.
Well Details
The 100 percent working interest 13-26 well was spud in early December and drilled to a total measured depth of over 4,200 metres including a horizontal leg of 1,350 metres. The well was completed in late January with 13 hydraulic fracture stages using a packer system. All 13 stages were successful, each placing approximately 80 tonnes of sand proppant.
The well was placed on test January 28 to begin cleaning up frac fluids, flowing up 41/2" casing at initial cleanup rates of up to 14 mmcf per day. The well was tied-in on February 7 to Open Range's Ansell/Sundance gas plant via an existing gathering line serving two producing wells on the same drilling pad. The well was brought on-stream at an initial production rate of 7.0 mmcf per day plus an estimated 90 bbls of NGL per day (total of approximately 1,260 boe per day) at a flowing pressure of 1,200 psi.
Open Range employed two of its in-house-designed Poseidon Concepts modular tanks to handle fluids for fracturing and flowback operations. (Please see the Company's press release dated January 24, 2011 for details.)
Continuing Wilrich Horizontal Activity
Open Range's $25 million first-half 2011 capital program includes a planned total of 4 (3.6 net) horizontal Wilrich wells at Ansell/Sundance using two drilling rigs currently on-location. The 13-26 well was the first well of the first-half program.
The next 100 percent working interest Wilrich horizontal well has been drilled to a total measured depth of over 4,100 metres, including a 1,100-metre lateral leg. It is scheduled for completion operations commencing by mid-February using a packer system, with a planned 13 fracturing stages. Completion results and production flow tests are expected in early March.
A further 100 percent working interest Wilrich horizontal well is currently drilling the lateral leg, with completion operations scheduled for late February.
The final Wilrich horizontal well of the first-half program (60 percent working interest) is expected to be spud by mid-February, with a planned total measured depth of over 4,300 metres including a lateral leg of over 1,300 metres.
Deep Basin Wilrich Horizontal Play Update
Open Range's first Wilrich well, which came on-stream October 15, 2010, continues to produce at a rate of approximately 3.4 mmcf per day plus 45 bbls of NGL per day (total of approximately 615 boe per day).
The Wilrich horizontal play continues to grow in the Deep Basin region around Ansell/Sundance. To date competitors have brought over 30 horizontal Wilrich wells on-stream at initial production rates averaging 3-9 mmcf per day. Combined area Wilrich production is estimated at more than 80 mmcf per day plus NGL.
The Wilrich type curve for the area indicates strong economics at current commodity prices. Anticipated per-well reserves of 3.5 bcf plus more than 45,000 barrels of NGL result in finding and development costs of under $10.00 per boe or $1.67 per mcfe. Strong first-year production rates and NGL content, along with low operating costs, are generating netbacks in excess of $20 per boe of production in the Wilrich at current commodity prices.
Open Range has delineated its Wilrich lands at Ansell/Sundance with over 40 Company-operated vertical wells penetrating the Wilrich Formation. The Company's 21-section prospective Wilrich area creates a strong, low-risk development opportunity. Open Range's current Wilrich horizontal inventory is 38 (32 net) locations at a density of up to two horizontal wells per section.
The Company's first-half 2011 production guidance remains unchanged at 4,200 boe per day.
OPEN RANGE ENERGY CORP. IS A PUBLICLY TRADED CANADIAN ENERGY COMPANY WITH FOCUSED OPERATIONS IN THE DEEP BASIN REGION OF ALBERTA.
OPEN RANGE HAS APPROXIMATELY 60.9 MILLION COMMON SHARES ISSUED AND OUTSTANDING, WHICH TRADE ON THE TSX UNDER THE SYMBOL "ONR".
Reader Advisory
This news release contains certain forward-looking statements, which include assumptions with respect to (i) results from drilling and completion operations; (ii) production; (iii) future capital expenditures; (iv) funds from operations; and (v) cash flow. The reader is cautioned that assumptions used in the preparation of such information may prove to be incorrect. All such forward-looking statements involve substantial known and unknown risks and uncertainties, certain of which are beyond Open Range's control. Such risks and uncertainties include, without limitation, risks associated with oil and natural gas exploration, development, exploitation, production, marketing and transportation, loss of markets, volatility of commodity prices, currency fluctuations, imprecision of reserve estimates, environmental risks, competition from other producers, inability to retain drilling rigs and other services, delays resulting from or inability to obtain required regulatory approvals and ability to access sufficient capital from internal and external sources, the impact of general economic conditions in Canada and the United States, industry conditions, changes in laws and regulations (including the adoption of new environmental laws and regulations) and changes in how they are interpreted and enforced, increased competition, the lack of availability of qualified personnel or management, fluctuations in foreign exchange or interest rates, stock market volatility and market valuations of companies with respect to announced transactions and the final valuations thereof, and obtaining required approvals of regulatory authorities.
Open Range's actual results, performance or achievements could differ materially from those expressed in, or implied by, these forward-looking statements and, accordingly, no assurances can be given that any of the events anticipated by the forward-looking statements will transpire or occur, or if any of them do, what benefits, including the amount of proceeds, Open Range will derive therefrom. Readers are cautioned that the foregoing list of factors is not exhaustive. All subsequent forward-looking statements, whether written or oral, attributable to Open Range or persons acting on its behalf are expressly qualified in their entirety by these cautionary statements. Additional information on the foregoing risks and other factors that could affect Open Range's operations and financial results are included in the Company's annual information form and other reports on file with Canadian securities regulatory authorities and may be accessed through the SEDAR website (www.sedar.com). Furthermore, the forward-looking statements contained in this news release are made as at the date of this news release and Open Range does not undertake any obligation to update publicly or to revise any of the included forward-looking statements, whether as a result of new information, future events or otherwise, except as may be required by applicable securities laws.
Disclosure provided herein in respect of barrel(s) of oil equivalent (boe) may be misleading, particularly if used in isolation. A boe conversion ratio of 6 mcf:1 barrel is based on an energy equivalency conversion method primarily applicable at the burner tip and does not represent a value equivalency at the wellhead. | |
| CONTACT INFORMATION:
Open Range Energy Corp.
A. Scott Dawson, P.Eng.
President and Chief Executive Officer
403-205-3704
or
Open Range Energy Corp.
Lyle D. Michaluk, CA
Vice President, Finance and Chief Financial Officer
403-262-9280
www.openrangeenergy.com
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| INDUSTRY: Energy and Utilities - Oil and Gas | |
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