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EMERALD RESOURCES NL — Capital/Financing Update 2009
Apr 2, 2009
64849_rns_2009-04-02_8331b4b1-331a-4891-bfce-03a87e1719aa.pdf
Capital/Financing Update
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Level 2, 16 Altona Street West Perth WA 6005 Ph: +618 9482 0510 Fax: +618 9482 0505 Email: [email protected] www.emeraldoilandgas.com
- 3 April 2009
Centralised Company Announcements Platform Australian Stock Exchange 10[th] floor, 20 Bond Street Sydney NSW 2000
FIRST GAS PRODUCTION IN KENTUCKY
Highlights:
Appalachian Project (Kentucky & West Virginia)
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2 wells producing in Magoffin County, Kentucky
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Kentucky frac to earn program increased to 8 wells
Appalachian Basin, Kentucky and West Virginia (Emerald earning 80% Working Interest; Operator: P&J Resources Inc)
Magoffin County, Kentucky
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Emerald and Gas NL is pleased to announce its first commercial gas production commenced from the first two of eight wells in Magoffin County, Kentucky, on April 1, 2009. This is a significant first step in Emerald’s plans to establish a significant gas production position from its Appalachian gas assets in 2009.
| Well | EmeraldWI | Formation | FractureStimulated | Status |
|---|---|---|---|---|
| GV Joseph - 6 | 80% | Big Six | No | Producing,Fracture treatment planned |
| Thomas Keeth-1 | 80% | Big Six | Yes | Producing |
| Don Cecil-1 | 80% | Big Six | Yes | Production expected in April |
| J Montgomery-1 | 80% | Big Six | No | Awaiting fracture treatment,production expected April |
| J Montgomery-2 | 80% | Big Six | No | Awaiting fracture treatmentproduction expected April |
| JD Vander-pool #5 | 80% | Big Six | No | Awaiting fracture treatmentProduction expected Q2 |
| GV Joseph – 1 | 80% | Big Six | No | Awaiting fracture treatmentProduction expected Q2 |
| GV Joseph – 2 | 80% | Big Six | No | Awaiting fracture treatmentProduction expected Q2 |
These are the first two of eight wells, which include six wells purchased by Emerald in 2008 and two additional wells recently acquired from P&J Resources. In all cases an 80% working interest is earned by completing the wells with production casing and fracture stimulation treatments. No initial well purchase was required for the two additional wells.
Gas rates from the two producing wells is being gradually increased for production. This will be followed by up to three more wells in April and the remaining three wells by end Q2, 2009.
All the wells are tied into a gathering system that links to the Jefferson Energy pipeline. Gas prices will range from 80% to 90% of the Appalachian Index price, which is at a premium to the Henry Hub price.
For more information please contact:
Emerald Oil & Gas NL
Tel: +618 9482 0510
MIKE KRZUS Chief Executive Officer [email protected]
JOHN HANNAFORD Executive Director – Finance [email protected]
About the Appalachian Gas Development Project
Emerald announced on April 30, 2008 that it had entered into a Drilling and Operating Agreement to develop two 45,000 acre lease areas in eastern Kentucky and western West Virginia. Under the agreement Emerald will earn an 80% working interest in a 4000 foot radius spacing unit for each well drilled for 100% of the drilling costs of each well. Both acreage areas have significant potential for infill drilling on 40 acre spacing, as well as several productive horizons.
The Appalachian Valley is USA’s oldest oil and gas producing area. Recent discoveries in the Marcellus Shale have now focused renewed exploration activity on the region. Combined with high gas prices, extensive infrastructure, enhanced drilling and completion techniques the area now offers extensive upside potential and compelling economics.
About Emerald Oil & Gas NL
Emerald Oil & Gas NL (ASX: EMR), listed on the ASX in June 2006, is an oil and gas exploration and production company with project interests in Kentucky, West Virginia, North Dakota and Texas in the USA and in the Canning Basin of Western Australia. Emerald’s focus is on both conventional and non-conventional reservoir targets for oil and gas prospects. Its primary objective is to achieve near term production and cashflow to build shareholder value and provide funds to fuel further growth. Emerald’s strategy is to take modest but meaningful positions in low risk exploration projects that can be swiftly brought into production.
Statements regarding Emerald’s plans with respect to its petroleum properties are forwardlooking statements. There can be no assurance that Emerald’s plans for development of its petroleum properties will proceed as currently expected. There can be no assurance that Emerald will be able to confirm the presence of additional petroleum deposits, that any discovery will prove to be economic or that an oil or gas field will successfully be developed on any of Emerald’s petroleum properties.