HOUSTON, Aug. 9, 2011 /PRNewswire/ - Enhanced Oil Resources Inc. (TSX-V: EOR) is pleased to provide the following update regarding the Company's activity for July, 2011.
The Company had previously announced that its principal focus for 2011 is the accelerated development of the Company's oil reserves at the Milnesand, Chaveroo and Crossroads oil fields. Specifically, during 2011 the Company continues to focus on:
- Commencing the Milnesand oil field 20-acre infill drilling program in New Mexico.
- Continuing a long-term program of well reactivations and workovers at both Milnesand and Chaveroo oil fields.
- Continuing to exploit behind pipe zones in existing wells in Crossroads oil field.
- Completion of pipeline right of way approvals for the Company's proposed 41 mile pipeline from Kinder Morgan CO2 Company LP's Cortez Pipeline to the Company's Milnesand and Chaveroo oil fields.
- Preparation for the potential delivery of CO2 to Milnesand oil field.
- Continued evaluation of a helium project in our St Johns field.
- Continued evaluation of a geothermal project in our St Johns field.
- Market and industry exposure of Enhanced Oil Resources.
Oil Field Operations
The Company is continuing with an active workover program at the Crossroads, Milnesand and Chaveroo oilfields in New Mexico. During July, crude oil production (excluding our new West Texas acquisition announced last month) has averaged approximately 436 gross barrels of oil equivalent per day (boepd) (95% oil), the highest average monthly rate achieved so far this year. Together with our recent acquisition, our July production has averaged approximately 460 boepd. At Crossroads, July production averaged approximately 320 boepd, an increase of approximately 33 boepd since May, 2011. We are continuing to give our attention to this field which has been enormously successful over the last two years. At our West Texas fields, we intend to commence a workover program to increase production following our approval as Operator of the fields by the Texas Railroad Commission.
The Company continues to utilize three well service rigs operating almost continuously in our oilfields to reactivate, convert or abandon non-producing wells. During July, the Company completed work on 6 wells and, in the year to date, we have completed operations on 59 wells.
As previously announced, the Company has initiated a plugging program of 13 non-essential wellbores at the Milnesand oilfield. At the end of July we have completed the plugging of 9 wells and anticipate the remaining wells in this program will be plugged in August. Upon notice and approval of the completion of these operations by the New Mexico Oil Conservation Division we expect that we can then commence our drilling program in the Milnesand field. Engineering design for the infill lateral wells from existing wellbores at Milnesand has been completed and we are currently soliciting vendors to commence this program as soon as approvals are received and services can be provided.
St Johns Development
The Company has engaged Pinpoint Drilling for the remaining two wells required for drilling under the St. Johns Gas Unit agreement obligations. We anticipate that drilling could commence by the beginning of the fourth quarter of this year. Both wells will be targeting the high Helium area of the field within the Amos Wash interval. We will provide further details once the drilling rig has arrived on location at St Johns.
On July 15, 2011 the Company was successful in reducing the well spacing at St Johns gas field from 640 acres to 160 acres. The reduction in well spacing will allow the Company to accelerate future production within a smaller area and by reducing substantially the production period of our reserves. As the Company continues to move forward with engineering and evaluation of our helium project the lowered well spacing will result in a much smaller footprint than previously proposed.
Market and Industry Exposure
The Company continues to work on its intended plan for increasing oil production, advancing the St. Johns project and increasing market exposure.
During July the Company presented at the Global Hunter Energy Conference in San Francisco July 18th and 19th, presented at the New York Energy Conference August 3rd and 4th, and will be exhibiting at the Summer Nape Conference in Houston during the third week of August.
Additional conferences are planned and these will be announced in the near term.
Certain statements contained herein are forward-looking statements, including statements relating to Enhanced Oil Resources' operations; business prospects, expansion plans and strategies. Forward-looking information typically contains statements with words such as "intends," "anticipate," "estimate," "expect," "potential," "could," "plan" or similar words suggesting future outcomes. Readers are cautioned not to place undue reliance on forward-looking information because it is possible that expectations, predictions, forecasts, projections and other forms of forward-looking information will not be achieved by Enhanced Oil Resources. By its nature, forward-looking information involves numerous assumptions, inherent risks and uncertainties. A change in any one of these factors could cause actual events or results to differ materially from those projected in the forward-looking information. Although Enhanced Oil Resources believes that the expectations reflected in such forward-looking statements are reasonable, Enhanced Oil Resources can give no assurance that such expectations will prove to be correct. Forward-looking statements are based on current expectations, estimates and projections that involve a number of risks and uncertainties which could cause actual results to differ materially from those anticipated by Enhanced Oil Resources and described in the forward-looking statements or information. The forward-looking statements are based on a number of assumptions which may prove to be incorrect. Readers should be aware that the list of factors, risks and uncertainties set forth above are not exhaustive. Readers should refer to Enhanced Oil Resources' current filings, which are available at www.sedar.com, for a detailed discussion of these factors, risks and uncertainties. The forward-looking statements or information contained in this news release are made as of the date hereof and Enhanced Oil Resources undertakes no obligation to update publicly or revise any forward-looking statements or information, whether as a result of new information, future events or otherwise, unless so required by applicable laws or regulatory policies.
ON BEHALF OF THE BOARD OF DIRECTORS
Barry D Lasker, CEO
Neither TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.
SOURCE Enhanced Oil Resources Inc.