In conjunction with the activation of the EOR/SWD, the company also commenced production from its third well (5-15). Without the EOR/SWD, the 5-15 well would likely have been uneconomic due to its high water cut as the operating costs to truck the water off the lease would have been prohibitive, the company said.
Blackdog has a 95.55% working interest (WI) in this well and it expects this well to produce on a sustained basis between 30-40 barrels of oil per day once the well stabilizes.
The company is in the final stage of equipping its fourth well (16-16) and it expects this well to be on production within the next three to five days. Blackdog has a 95.55% WI in the well. Both wells 5-15 and 16-16 required surface equipment for reactivation and no down hole work was required.
This month, the company has also undertaken a re-entry program on well 11-21. Prior to commencing work on this well, which was originally purchased in January, 2010, the company increased its WI in the well by purchasing an additional 8.33% from a public company in February.
Blackdog was initially required by the energy resources conservation board to abandon two uneconomic lower gas zones that were drilled and perforated by a previous operator. Blackdog then perforated the target Halfway light oil zone. The well swabbed a combination of light oil and water and is currently being equipped for production.
The oil was delivered to a nearby facility and sold. Blackdog expects this well to be producing before March 31, 2010 as it requires only the installation of a pump jack and otherwise was purchased fully equipped.
The company has a 91.66% WI in this well. The 11-21 well will qualify for the reduced Alberta royalty rate of 5% for its first year of production. Last year, the company was also notified by the ministry of energy that well 13-15, which commenced production in October, 2009, also qualifies for the reduced Alberta royalty rate of 5% for its first year of production.
