DENVER, Sept. 29 /PRNewswire-FirstCall/ - Kodiak Oil & Gas Corp. (TSX Venture: KOG; U.S. symbol KOGGF) today provided an operations update on its Green River Basin (Sweetwater County, WY) and Williston Basin (Sheridan County, MT and Divide County, ND) oil and gas properties. The Company currently has two non-operated rigs drilling in Sweetwater County, WY and has secured drilling contracts for two additional rigs that will be operating in the Williston Basin on properties operated by Kodiak. The Company expects to participate in the drilling of 10 gross wells (3.70 net wells) during the remainder of 2005 and into the first part of 2006 with estimated capital expenditures of $5.9MM. Kodiak President and CEO, Lynn Peterson, noted that, "This will be an exciting period in Kodiak's initial growth phase. Our increased activity is an indicator of our commitment to proving up our various Rocky Mountain leaseholdings. We are fortunate to obtain drilling contracts in the tight Rockies drilling and service market and intend to accelerate activity to take advantage of the rigs. This will complete our exploration program as set forth in early 2005 which we expanded due to our drilling success. As a result of the exercise of the warrants in August, the Company is completely funded for its drilling program." Green River Basin, Sweetwater County, Wyoming Chicken Springs --------------- Development drilling operations have commenced on this prospect (50% Working Interest; non-operator) to develop the potential of the Almond sands and coals. The PRFED 14100 4-29 well is currently drilling to an expected total depth of 6,200 feet. Upon completion of drilling operations, estimated at ten days, the rig will be moved to the PRFED 14100 4-32 well location. Kodiak will frac and complete the wells and evaluate both the sands and the coals in the well bore. Production will be tied into the existing production facilities. Installation of compression facilities is in progress and should be completed in mid-November. Current production from the Unit is 100-200 Mcf of gas per day, surface constrained. With the addition of compression, production should increase significantly. A third well, the PRFed 14100 2-31, will be drilled within the Chicken Springs Unit to evaluate the potential of the Almond coals by horizontally drilling one of the existing coal seams. Based upon a thick coal seam that is present in several surrounding wells and from seismic evaluation, the prospect lends itself to the horizontal technology. The drilling program projects two laterals out of one well bore extending 1,000-4,000 feet each. Chicken Ranch ------------- The 8-9 Chicken Ranch Unit well (33.33% WI; non-operator) will commence drilling today to an estimated total depth of 8,600 feet to test the natural gas potential in the Almond and Ericson Formations. The well is a one mile offset to the Kinney Rim 3-5 well drilled by Anschutz Corp in 1982. The well was completed in the Ericson sands flowing 740 Mcf gas per day. Due to the lack of pipelines and the price of gas, the well was plugged and abandoned by Anschutz. Kodiak's working interest ranges from 16.67% to 88% under 7,858 gross acres in the Chicken Ranch Federal Unit. Pacific Isle ------------ Production from the 15 wells was tied into the sales line and gas sales commenced in early September, 2005. Production rates, while minimal, will defray operating expenses during the continuing dewatering process. Desorption is proceeding as expected and Kodiak awaits results to evaluate the ultimate productive potential of the project. Masterson --------- The Masterson Federal No. 24-11 well (40% WI; non-operator) was completed in the Second Frontier Formation at a depth of 6,234 to 6,288 feet. The well was connected to a pipeline and placed on production in August 2005 with current production of approximately 315 Mcf gas per day. One development location is being permitted and will be drilled once approved and a drilling rig becomes available. Williston Basin Lowell/North Wrangler Prospects (Sheridan County, Montana) -------------------------------- The Company commenced production from the State 8-16 well, located in Sheridan County, MT, on September 6, 2005 (25% WI; operated by Kodiak). The well was drilled to a depth of 7,615 feet and has produced 1,373 barrels of oil from the Mission Canyon Formation in 17 days. Over this time period the well has been flowing naturally without any artificial lift or stimulation. The Company will continue to evaluate production from the well before installing a pump to increase production rates. The Company has contracted a drilling rig that is moving on location and will commence operations the first week of October. The Company plans to commence a drilling program consisting of two development wells and one exploratory test to evaluate the Mission Canyon Formation. Depending upon the drilling results, the Company could continue the drilling program as it is permitting six additional locations on the prospect lands and can retain the drilling rig if the program develops. Kodiak owns a 25% working interest under 8,429 acres under the Cinnamon Bear Project, consisting of the Lowell and North Wrangler Prospects. Great Bear Prospect (Divide County, North Dakota) -------------------- Kodiak has contracted a drilling rig, scheduled to be on location the first half of November, to evaluate the Red River potential on its Great Bear Prospect (37.5% WI; operated by Kodiak) in Divide County, ND. Kodiak has pooled its acreage with other leaseholders in the 3-D seismic area and has a 37.5% working interest in 11,616 gross acres. The Company is permitting two locations on the prospect lands. The first test will be drilled into the Red River Formation at 10,550 feet and then an approximate 4,000 foot lateral will be drilled. The well is an offset of a well drilled in 1984 that has produced 175,000 barrels of oil to date and is currently producing 15 barrels of oil per day. The second well will be vertically drilled to an approximate depth of 10,750 feet. This drilling program will be completed during the first quarter of 2006. Grizzly Prospect (McKenzie County, North Dakota) ----------------- The Company recently acquired an additional 800 acres within the fairway of the horizontal Bakken play in Richland County, MT down into McKenzie County, North Dakota. The acreage is contiguous to the Company's existing acreage holdings increasing its total acreage to 3,307 gross acres (37.5% WI; operated by Kodiak). A private company is currently drilling two horizontal wells directly offsetting the acreage to the north. The Company is completing the permitting process for a location on its Grizzly prospect. The Company intends to use the same rig it has under contract for the Great Bear Prospect and the drilling will commence the first quarter of 2006. About Kodiak Oil & Gas ---------------------- Kodiak Oil & Gas, headquartered in Denver, is an independent energy exploration and development company focused on exploring, developing and producing oil and natural gas in the Williston and Greater Green River Basins in the U.S. Rocky Mountains. The common shares of the Company are listed for trading on the TSX Venture Exchange under the symbol "KOG" and the U.S. symbol "KOGGF." Forward-Looking Statements -------------------------- This press release includes statements that may constitute "forward- looking" statements, usually containing the words "believe," "estimate," "project," "expect" or similar expressions. These statements are made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. Forward-looking statements inherently involve risks and uncertainties that could cause actual results to differ materially from the forward-looking statements. Factors that could cause or contribute to such differences include, but are not limited to, fluctuations in the prices of oil and gas, uncertainties inherent in estimating quantities of oil and gas reserves and projecting future rates of production and timing of development activities, competition, operating risks, acquisition risks, liquidity and capital requirements, the effects of governmental regulation, adverse changes in the market for the Company's oil and gas production, dependence upon third-party vendors, and other risks detailed in the Company's periodic report filings with the BC Securities Commission. 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SOURCE Kodiak Oil & Gas Corp.