Redfork yesterday said the well was spudded last Friday and was scheduled to be drilled to a total depth of about 1500 feet (457.2m), targeting the Dawson, Iron Post and Crowburg coals.
The company anticipated Redfork 2-29 and three other wells would be drilled, completed and tied-in to production infrastructure in the September quarter. Drilling results and initial production data will be released as they become available.
The company plans to drill another six CSM wells this year in the Cherokee Basin.
Executive director David Prentice said to achieve the goal of establishing significant in-place gas reserves, the company had focused on securing strategic lease holdings and development permits; establishing production infrastructure and cash flow; and fully developing lease holdings.
It had now acquired 100% ownership (80% net revenue interest) of oil, gas and CSM leases covering 4200 acres (almost 1700 hectares) in the Cherokee Basin.
Drilling permits had been prepared and filed with the Bureau of Indian Affairs and the Osage Nation Agency, with the first of these permits now approved and an expected 15 permits in total available during the second half of 2006.
Development activity to date had focused on the company’s 15 existing wells to access open zones and “behind pipe” oil and gas. Production infrastructure was now in place and Redfork had started selling gas – via the company’s agreement with Scissortail Energy – and some oil.
Revenue generated from this initial production would help fund exploration and development.
Workovers and re-working (to access “behind pipe” zones) of existing wells had started, with the first program targeting the Bass 90-1, Osage 86-1 and Church 88-1 wells completed during the March quarter. The next program, targeting the CC East 4-A and 2-A, Broken Drum 1-C and Demier 2-G wells, was expected to be completed in the September quarter.
Redfork also said that data collected from CSM drilling, together with information from its own and neighbours’ development and production activities, would be gathered and evaluated to establish the project’s in-place gas reserves potential. Independent consultants would be engaged to provide these estimates, which the company expects to be completed by next March.
As far as fully developing its lease holdings, Redfork expected the project area to support up to 80-acre spacings (one well per 80 acres) with initial completion of only one coal per well. This would provide the opportunity for the company to drill and complete up to 50 wells on current lease holdings. A successful CSM well is estimated to have the capacity to produce for at least 10 years.
Redfork’s Cherokee Basin CSM project is adjacent to three of the region’s most successful CSM players – Amvest Osage, Newfield Exploration and Admiral Bay Resources.
