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Empyrean Energy (LSE:EME), an AIM-listed profitable US onshore oil, gas and condensate exploration, development and production company with assets in Texas and California, is pleased to announce its participation in two new wells in the Eagle Ford Shale, Texas.
This participation is a part of its interest in ‘Sugarloaf Block A’ operated by Burlington Resources Oil & Gas Company LP (‘Burlington’) a subsidiary of ConocoPhillips Company (‘Conoco’). This recommences the activity in Block A, which is nearby to the Company’s flagship Sugarloaf AMI.
The Baker Trust-4 well (‘Baker Trust’), in which Empyrean has an approximate 2.45% working interest, reached an approximate measured depth of 17,948 feet on 28 August 2013 with a lateral length of approximately 5,000 feet. This well is currently awaiting completion. The estimated net drilling cost to Empyrean is US$225,000. Should the well be successful there will be completion and connection costs to follow.
The Marlene Olson-3 well (‘Marlene Olson’), in which Empyrean has an approximate 0.85% working interest, will be drilled to an approximate measured depth of 20,700 feet at an estimated net drilling cost of US$100,000 (excluding completion and connection costs) to Empyrean, with a lateral length of approximately 7,700 feet. The Company has been informed by the operator that the Marlene Olson will commence drilling in the second half of September 2013.
Both wells are to be completed in the Eagle Ford Shale and are being drilled from the same pad along with a third well that is being completed in acreage that Empyrean has no interest in. Empyrean’s interest in these two wells is less than the 7.5% interest it holds in the acreage due to these wells traversing into acreage that Empyrean does not participate in – resulting in Empyrean participating in a pro-rata proportion. An update will be provided as a separate heading under “Sugarloaf Block A” in Empyrean’s planned quarterly production update for the Sugarloaf AMI.
Empyrean CEO Tom Kelly commented, “Conoco, the US major, has been active in acreage surrounding Block A and our participation in two new wells in a highly productive highway of the Eagle Ford Shale marks an exciting step-up in activity on our acreage. These wells add to the gross 91 producing wells at our flagship Sugarloaf AMI acreage, which boosted our revenues by 119% to £5.89 million for full year to 31 March 2013.”
Having entered into a 16 well programme with Texas Crude Energy announced on 10 May 2007 Empyrean participated in five wells on Block A before withdrawing from the programme. The Company has retained a 7.5% interest in 580 gross lease acres (43.5 net acres) as a result of the participation in the five original wells drilled on Block A. If wells are anticipated to be completed within the acreage that Empyrean retains an interest in, then Empyrean will receive a well proposal and election to participate for its proportionate share.
