Credo Petroleum Updates Nebraska Oil Drilling Results
18 May 2011 - 10:00PM
Credo Petroleum Corporation (Nasdaq:CRED), an independent oil and
gas exploration and production company with significant assets in
the North Dakota Bakken, Kansas, Nebraska, the Texas Panhandle and
Oklahoma, today updated its shallow oil drilling results in
Nebraska.
Marlis E. Smith, Jr., Chief Executive Officer, stated, "This
press release focuses on our new shallow oil drilling play in
Nebraska where we are off to a strong start drilling high ownership
interest wells. Thus far, we have hit three out of the first
four wells in which we own a 70% working interest. These wells
had combined initial/flush production rates of 350 barrels of oil
per day. Credo is also continuing to actively drill horizontal
wells in the North Dakota Bakken and the Texas Panhandle and
conventional vertical wells in central and western Kansas."
COMPANY SUCCESSFUL IN FIRST THREE OUT OF
FOUR WELLS
The Nebraska drilling play is an extension of the company's
Central Kansas Uplift drilling play where Credo has achieved a 40%
success rate, including two new wells which are currently being
tested. To date, Credo has assembled approximately 40,000 net
acres in southwestern Nebraska. A significant inventory of
drilling prospects has already been generated and assembled
utilizing a combination of detailed subsurface geology and advanced
3-D seismic technology to identify highly economic shallow oil
targets. The Company is continuing to aggressively generate
and lease additional prospects. Drilling commenced in the
first quarter of 2011 and targets the Lansing Kansas City formation
at about 4,000 feet. The Company has retained between a 50% and 70%
working interest in the play in order to participate significantly
in what it believes will be a very successful project.
Credo has recently completed two new discoveries and one field
extension well. The new wells are located in the southwestern
portion of Nebraska, however, for proprietary business reasons,
their names and locations are not being disclosed.
The new discoveries resulted from re-entering abandoned wells on
separate prospects. This 100% success rate on re-entering
abandoned wells clearly demonstrates how the application of
innovative geological and engineering concepts can yield excellent
success, even in mature areas. The two wells were completed in
the Lansing Kansas City formation at about 4,000 feet, and tested
at initial rates of 50 barrels per day and 100 barrels per day,
respectively. Pumping units are in the process of being
installed on the wells. Credo owns a 70% working interest in
the wells, and believes that there is offset drilling potential on
both prospects.
Also in southwest Nebraska, completion operations have just been
completed on a third new well. The well was drilled as an
extension to an existing field which has produced about 200,000
barrels of oil. The well tested at an initial rate of
approximately 200 barrels of oil per day from the Lansing Kansas
City formation at 4,000 feet. Based on the company's current
geological concept, there are offset locations, potentially making
this an ideal waterflood project at the end of primary
production. Credo owns a 70% working interest and is the
operator.
MANAGEMENT COMMENT
"Profitability has long been a consistent, vital theme at
Credo," Smith continued. "Our new shallow oil play in Nebraska
reinforces the Company's emphasis on bottom line success, and again
demonstrates our ability to discover and develop significant oil
reserves at very moderate cost. While horizontal drilling
seems to be all the buzz these days, Credo has positioned itself to
enjoy the best of both worlds as we exploit our horizontal oil
drilling acreage in the North Dakota Bakken and Texas Panhandle,
along with our very high rate of return conventional oil drilling
in Kansas and now Nebraska. In the second half of 2011, we
will continue to execute the most aggressive drilling program in
Company history as we focus on rapidly building Credo's oil
reserves and production."
About Credo Petroleum
Credo Petroleum Corporation is an independent oil and gas
exploration, development and production company based in Denver,
Colorado. The Company has significant operations in the
Williston Basin of North Dakota, central Kansas, the Anadarko Basin
of the Texas Panhandle and northwest Oklahoma, and in southern
Oklahoma. Credo uses advanced technologies to systematically
explore for oil and gas and, through its patented Calliope Gas
Recovery System, to recover stranded reserves from depleted gas
reservoirs. For more information, please visit our website at
www.credopetroleum.com or contact us at 303-297-2200.
This press release includes certain statements that may be
deemed to be "forward-looking statements" within the meaning of
Section 27A of the Securities Act of 1933, as amended, and
Section 21E of the Securities Exchange Act of 1934, as
amended. All statements included in this press release, other
than statements of historical facts, address matters that the
Company reasonably expects, believes or anticipates will or may
occur in the future. Such statements are subject to various
assumptions, risks and uncertainties, many of which are beyond the
control of the Company. Investors are cautioned that any such
statements are not guarantees of future performance and that actual
results or developments may differ materially from those described
in the forward-looking statements. Investors are encouraged to
read the "Forward-Looking Statements" and "Risk Factors" sections
included in the Company's Annual Report on Form 10-K for more
information. Although the Company may from time to time
voluntarily update its prior forward looking statements, it
disclaims any commitment to do so except as required by securities
laws.
CONTACT: Marlis E. Smith, Jr.
Chief Executive Officer
or
Alford B. Neely
Chief Financial Officer
303-297-2200
Website: www.credopetroleum.com
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