Area Drilling

May 19, 2008

Argentina

The Mendoza government formally authorized Oromin Explorations Ltd., Vancouver, BC, to exploit oil and gas on the 7,694 sq km Santa Rosa Block in Argentina’s Cuyana basin.

The 300 sq km of greatest exploration interest on the block covers a large, untested dome less than 1,200 m deep that is defined by four regional seismic lines.

Otto Energy Ltd., Perth, has a letter of intent with Oromin that enables it to earn up to a 41.24% working interest by spending up to $2,297,381.

The basin has produced more than 940 million bbl of oil.

Brazil

Petroleo Brasileiro SA (Petrobras) and partners are evaluating the possibility of using a different rig to complete drilling an exploration well on the Serpa subsalt prospect on Block 24 in the Espirito Santo basin off Brazil.

The well has not yet reached its primary objective or its projected total depth of 19,500 ft, but the partnership was “encouraged by evidence of an active petroleum system in the subsalt section encountered in the well,” said 30% partner Anadarko Petroleum Corp.

Petrobras is operator with 40% working interest, and EnCana Brazil Ltda. has 30%.

Georgia

Frontera Resources Corp., Houston, said it appears to have established sustainable oil production with no associated flow of sediment at its Dino-2 well in the Taribani field unit in Block 12 in eastern Georgia’s Kura basin (see map, OGJ, Nov. 26, 2007, p. 32).

Zone 9, a 10-m reservoir at 2,300 m, has produced at rates as high as 150 b/d of 36° gravity oil on a 464-in. choke with 1,500 psi surface pressure drawdown from bottomhole pressure of 5,900 psi after frac.

The well will remain on test for 20-60 days, and the workover rig and frac equipment are moving to the T-45 location for a frac pac completion attempt in Zone 9 at 2,400 m.

Montana

Bill Barrett Corp., Denver, plans to start a program in the second quarter of 2008 to drill as many as four vertical wells to Cretaceous Cody shale in the overthrust southeast of Helena, Mont.

The company tested gas flows from Cody shale at the Draco and Leviathan wells in the area, but production capability depends on the discovery of commercial quantities of gas to support pipeline construction. The company has a 50% operated working interest in the Circus and Toston-Six Mile areas, where it had amassed 162,000 acres by the end of 2007.

North Dakota

Continental Resources Inc., Enid, Okla., initiated a frac job in the Three Forks/Sanish formation in early May on the Bice 1-29H well in Dunn County, ND.

In this part of the Williston basin Nesson anticline, the Lower Bakken shale underlies the widely exploited Middle Bakken shale and overlies the little explored Three Forks/Sanish.

“Continental is testing the theory that the Three Forks/Sanish zone is not being drained by wells that have been drilled in the Middle Bakken horizontal lateral, and, therefore, that the Three Forks/Sanish may hold significant additional reserve potential under the company’s acreage,” the company said.

Oregon

US Geothermal Inc., Boise, Idaho, has spud the first full-size geothermal well at its Neal Hot Springs project in northern Malheur County, eastern Oregon, 90 miles northwest of Boise.

The NHS-1 well is permitted to 3,500 ft at a spot near a 1979 discovery well drilled by Chevron Minerals. US Geothermal expects 30 days of drilling and 60 days of flow and reservoir tests.

The company has leased 9.6 sq miles in the area where a suite of wells drilled by Chevron identified a commercial geothermal resource at 2,820 ft. Consultants reported likely reservoir temperatures of 311-320° F. Gravity and magnetic data were used to identify drilling locations.

The development plan anticipates 26 Mw of power production.

Tennessee

Logs from a well in Morgan County, Tenn., appear to show 17 ft of net pay in the Cambrian Rome formation, which has never produced in Tennessee, said Montello Resources Ltd., Calgary.

The John Bowen-2 well log showed the potential gas zone at 8,275 ft. A completion attempt is planned. The well site is 1 mile from a gas pipeline.

Utah

Delta Petroleum Corp., Denver, said its Federal 28-11 well in 28-22s-17e, Grand County, Utah, is averaging 200 b/d of oil and 600 Mcfd of gas from the O and P intervals of Pennsylvanian age in the northwestern Paradox basin.

Meanwhile, the company reached total depth in the quarter ended Mar. 31 at the Federal 31-36, Federal 26-43D, and Federal 36-24H wells, all in its Greentown project area in Grand County. It plans to drill laterals as long as several thousand feet at these wells in both the Pennsylvanian Cane Creek shale and shallower O interval.

The company’s Greentown gas pipeline is expected to be in service by the end of June.

Delta plans to drill later this year at its Cocklebur Draw prospect in Southwest Colorado to different geologic intervals than those at Greentown.

Washington

Delta Petroleum Corp., Denver, is moving a rig to the Columbia River basin to spud the Gray 31-23 wildcat on its 100% owned Bronco prospect in Klickitat County, Wash. (OGJ, Jan. 14, 2008, p. 35).

Delta expects the well to emerge from basalt at 8,000 ft and to be one of the basin’s only wells to penetrate the entire Eocene Roslyn formation, which it reckons will be 4,500 ft thick. Projected total depth is 15,000 ft.

The well, to be drilled with or without third-party participation, is expected to spud during May 2008. The company said it continues to be in discussion with several industry companies regarding participation.