SAN ANTONIO, Sept. 22, 2011 /PRNewswire/ -- Cross Border Resources, Inc. (OTCQX: XBOR), a San Antonio-based oil and gas exploration and production company, today provided an operations update on its two Wolfberry projects in the Permian Basin of West Texas.
The Company and its partners have been successful in limiting water production, with complementary oil production increases, from the first four Wolfberry wells. Initial well results disseminated by the Company indicated low production rates due to excessive water volumes. In early August, prior to remedial changes, the wells averaged 8 barrels of oil per day (bopd) and 266 barrels of water per day (bwpd) overall, or an oil cut of 2.9%. The wells now average 71 bopd and 145 bwpd, with oil cut improving to 32.9%.
Early reports indicated the wells' operator felt there was communication between a water zone and one of the targeted formations that was fractured stimulated, thus contributing to the low oil volumes. Cross Border management and its partners determined it would be necessary to set a temporary bridge plug in each of the wells, at various depths, to determine what specific zone was contributing the excess water.
"Management is pleased that our partners have identified the water-bearing zone, allowing for greater oil production," said Everett "Will" Gray II, CEO and Chairman of Cross Border. "The initial evaluation of these projects provided rates of return in excess of 35%, thus prompting management to participate in these two Wolfberry projects. Although combined daily production from all four wells is approximately 284 bopd, or an average of 71 bopd per well, it is important to note that this production is only from three of the seven zones that were frac stimulated.
"We anticipate that production will continue to trend upward following optimal placement of the bridge plugs over the next several weeks," Gray continued. "Production volumes from these two Wolfberry projects are expected to represent approximately 50 net bopd, thus 10% of the projected production exit rate for 2011."
Since March 2011, Cross Border has participated in the following Wolfberry wells located in West Texas:
Shortes 6 #1
Shortes 43 #1
Coleman 9 #1
Simmons 27 #2
Buck Baker 15 #2
Hefley 24 #1
Separately, Cross Border will not be able to present at next week's Independent Petroleum Association of America Oil & Gas Investment Symposium due to a scheduling conflict. A webcast of the Company's Sept. 12 presentation at Rodman & Renshaw's Annual Global Investment Conference, a current investor presentation, and management's second-quarter conference call are available on the Investor Relations page of the Company's website, www.xbres.com, to keep investors informed about current activity.
About Cross Border Resources
Cross Border Resources is an oil and gas exploration company, headquartered in San Antonio, Texas, focusing on non-operated opportunities with proven operators within the Permian Basin. Cross Border consists of over 800,000 gross (approximately 300,000 net) mineral and lease acres within the state of New Mexico targeting various emerging plays including the 1st & 2nd Bone Spring, and more conventional plays such as the Abo, Yeso, San Andres, as well as our Wolfberry acreage located in West Texas. Cross Border Resources currently owns approximately 31,000 net acres within the Permian Basin.
This news release contains forward-looking statements that are not historical facts and are subject to risks and uncertainties. Forward-looking statements are based on current facts and analyses and other information that are based on forecasts of future results, estimates of amounts not yet determined, and assumptions of management. Forward-looking statements are generally, but not always, identified by the words "expects", "plans", "anticipates", "believes", "intends", "estimates", "projects", "aims", "potential", "goal", "objective", "prospective", and similar expressions or that events or conditions "will", "would", "may", "can", "could" or "should" occur. Information concerning oil or natural gas reserve estimates may also be deemed to be forward-looking statements, as it constitutes a prediction of what might be found to be present when and if a project is actually developed.
Actual results may differ materially from those currently anticipated due to a number of factors beyond the reasonable control of the Company. It is important to note that actual outcomes and the Company's actual results could differ materially from those in such forward-looking statements. Factors that could cause actual results to differ materially include misinterpretation of data, inaccurate estimates of oil and natural gas reserves, the uncertainty of the requirements demanded by environmental agencies, the Company's ability to raise financing for operations, breach by parties with whom the Company has contracted, inability to maintain qualified employees or consultants because of compensation or other issues, competition for equipment, inability to obtain drilling permits, potential delays or obstacles in drilling operations and interpreting data, the likelihood that no commercial quantities of oil or gas are found or recoverable, and our ability to participate in the exploration of, and successful completion of development programs on all aforementioned prospects and leases. Additional information risks for the Company can be found in the Company's filings with the U.S. Securities and Exchange Commission.
Cross Border Resources, Inc.
Everett Willard "Will" Gray II
SOURCE Cross Border Resources, Inc.