By OGJ editors
HOUSTON, Nov. 8 -- Ivanhoe Energy Inc. and Derek Oil & Gas Corp., both of Vancouver, BC, commenced continuous steaming operations at the enhanced oil recovery pilot program in LAK Ranch oil field in Weston County, Wyo.
Production from the pilot well increased to 60 b/d of oil from 10 b/d in the first 6 days of continuous operations. The oil is being sold for $57/bbl.
Three vertical steam injection wells were drilled in late August and September above existing horizontal wells. The effects of steam on the pay section will be measured to evaluate the effectiveness of the process, with volumes and quality of steam monitored and adjusted as necessary. Production improvements are expected over the next several months.
Derek Oil & Gas holds a 53% interest in the Powder River basin field. Ivanhoe Energy currently holds 42%, and an unnamed party holds the remaining 5%.
After the pilot phase is finished, Ivanhoe Energy has the option to increase its working interest to 60% by providing additional capital toward the initial development phase for a total of $5 million. If Ivanhoe Energy elects not to proceed beyond the pilot phase, its working interest will be reduced to 15%, and Derek Oil & Gas will become the operator.
