In late September 2012, Hemisphere drilled one horizontal oil well and one vertical oil well while initiating a new 3D seismic program.
The horizontal oil well targeted an existing pool that had been previously discovered and produced from vertical wells. This well was completed, tied-in and placed on production at a rate of approximately 140 barrels of oil per day ("bopd") as previously announced in November 2012.
The vertical well was the first well drilled on the seismic option and farm-in agreement announced in June 1012. This well was drilled to hold land expiring in October 2012. The well was completed and equipped with a single well battery and was placed on production on December 1, 2012.
The new 3D seismic survey was completed in October 2012 spanning the prospective farm-in lands along one of the main Glauconitic trends in the Jenner area. This survey has been interpreted and Hemisphere has identified a number of potential drilling locations, some of which will be targeted in 2013.
In November and early December 2012, Hemisphere drilled an additional three horizontal wells targeting three different Glauconitic formation oil pools, all of which have been completed, equipped and placed on production. One horizontal well came on with a production rate of approximately 100 bopd and has been tied-in to Hemisphere's main Jenner battery. The second horizontal well, which was an option well drilled to earn additional farm-in lands, was brought on production at a rate of approximately 75 bopd and is producing to a single well battery. The third horizontal well is tied-in to Hemisphere's main Jenner battery and is flowing approximately 10 bopd with high initial watercuts. The company has recently installed an artificial lift system to move more fluid and increase oil rates.
With the addition of the three wells recently placed on production and based on field estimates, Hemisphere's production for the first nine days of January averaged 550 boe/d with a 94% oil and NGL weighting.
Hemisphere has expanded its Jenner landholdings through the successful acquisition of 6.5 sections (4,100 acres) of land at recent crown land sales. This additional land increases Hemisphere's position in Jenner by 33% to approximately 16,000 net acres with an additional 6 sections (3,800 net acres) to earn in farm-in lands.
Change in Year-End
Hemisphere previously announced its change in year-end from February 28 to December 31. This transition will take place in the next reporting period at which time the company plans to report its year-end audited financial statements for the 10 months ended December 31, 2012.
About Hemisphere Energy Corporation
Hemisphere Energy Corporation is a junior exploration and production company focused on developing core areas that provide low to medium risk drilling opportunities to increase production, reserves and cash flow. Hemisphere's continued growth plan is through drilling existing prospects and executing strategic acquisitions and farm-ins. Hemisphere trades on the TSX Venture Exchange under the symbol "HME".
This news release contains "forward-looking statements" that are based on Hemisphere's current expectations, estimates, forecasts and projections. These forward-looking statements include statements regarding Hemisphere's outlook for our future operations, plans and timing for the commencement or advancement of exploration and development activities on our properties, and other expectations, intention and plans that are not historical fact. The words "estimates", "projects", "expects", "intends", "believes", "plans", or their negatives or other comparable words and phrases are intended to identify forward-looking statements. Such forward-looking statements are subject to risks, uncertainties and other factors that could cause actual results to differ materially from future results expressed or implied by such forward-looking statements. Many of these factors are beyond the control of Hemisphere. Consequently, all forward-looking statements made in this news release are qualified by this cautionary statement and there can be no assurance that actual results or developments anticipated by Hemisphere will be realized. For the reasons set forth above, investors should not place undue reliance on such forward-looking statements. Hemisphere disclaims any intention or obligation to update or revise forward-looking information, whether as a result of new information, future events or otherwise.
Barrels of oil equivalent ("boe") may be misleading, particularly if used in isolation. A boe conversion ratio of 6 Mcf:1 Bbl is based on an energy equivalency conversion method primarily applicable at the burner tip and does not represent a value equivalency at the wellhead.
Neither the 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 news release.
Hemisphere Energy Corporation
President & Chief Executive Officer
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