At Blair, Painted Pony has commenced the drilling of the first of two Upper Montney horizontal wells located on the new A-91-F/94-B-16 pad. Both of these wells are targeting the Upper Montney zone to test the potential for increased liquids content along the northeastern section of the Company's Blair acreage. These two wells will be drilled sequentially and completed immediately thereafter. Production test results are expected in the second quarter.
At Cypress, repairs to the gas gathering pipeline in which the Company has an interest have now been completed. Accordingly, Painted Pony plans to reactivate the Cypress area in April. It is expected that six 100% working-interest gas wells will re-commence production, with an anticipated initial volume of approximately 3 MMcf/d net to Painted Pony.
LIGHT OIL PROJECTS
Painted Pony continues to maintain an inventory of light oil opportunities, focusing on projects in southeastern Saskatchewan and central Alberta. To-date during the first quarter of 2013, the Company has participated in drilling 2 (1.1 net) oil-directed wells in Saskatchewan, including the Company's first 2-mile horizontal well into the Bakken Formation at Flat Lake. This 30% working interest well was drilled to a total depth of 5,168 metres and fracture stimulated across 46 stages. The well has recently been placed on production.
During January, Painted Pony completed and commenced testing of the Company's first exploratory discovery well on its Viking light oil play at Corbett, Alberta. During initial testing the well produced 31 degree API oil. Painted Pony has equipped the well for a sustained production test - results of this test are expected during the third quarter of 2013. The Company believes that the Corbett play may represent an analogous extension to the Viking production trends which are currently being developed by industry players at Redwater and Provost. The Company has recently acquired an additional 12 (12.0 net) sections of Crown mineral rights at Corbett, bringing its total undeveloped landholdings on this project to 18 (18.0 net) sections (11,520 acres).
During the first two months of 2013, Painted Pony's field-estimated sales averaged 8,200 boe/d, (weighted 78% to gas), an increase of 12% from average fourth quarter 2012 volumes of 7,289 boe/d (76% gas weighted).
This news release contains certain forward-looking information (collectively referred to herein as "forward-looking statements") within the meaning of applicable Canadian securities laws. Forward-looking statements are often, but not always, identified by the use of words such as "anticipate", "believe", "plan", "potential", "intend", "objective", "continuous", "ongoing", "encouraging", "estimate", "expect", "may", "will", "project", "should", or similar words suggesting future outcomes.
These forward-looking statements are based on numerous assumptions including but not limited to (i) drilling success; (ii) production; (iii) future capital expenditures; and (iv) cash flow from operating activities. The reader is cautioned that assumptions used in the preparation of such information may prove to be incorrect.
Forward-looking statements are based upon the opinions and expectations of management of the Company as at the effective date of such statements and, in some cases, information supplied by third parties. Although the Company believes that the expectations reflected in such forward-looking statements are based upon reasonable assumptions and that information received from third parties is reliable, it can give no assurance that those expectations will prove to have been correct. Forward-looking statements are subject to certain risks and uncertainties that could cause actual events or outcomes to differ materially from those anticipated or implied by such forward-looking statements.
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