Press release from Marketwire
Artek Exploration Ltd. Provides Spring Operational and Credit Facility Update
Tuesday, May 01, 2012
CALGARY, ALBERTA--(Marketwire - May 1, 2012) - Artek Exploration Ltd. (TSX:RTK) ("Artek" or the "Company") is pleased to provide the following operational update.
The Company has successfully drilled and completed the first of seven horizontal wells (60% working interest) planned for 2012 at its Doig natural gas and condensate pool in the Inga area of British Columbia. The well is the furthest North step out to Artek's previous horizontal Doig wells in the pool which tested at an average rate of over 2,000 boe/d with approximately 1,600 bbl/d of condensate. After an 80 hour test that was conducted in-line and still cleaning up, the horizontal well was flowing at an average rate of 2,366 boe/d, of which approximately 6.5 mmcf/d was natural gas (15% load C3) and 1,283 bbls/d was condensate as measured at the Company's facility, or a total of approximately 2,200 boe/d (58% condensate) net of load over the last five hours at a flowing pressure of 1,172 PSI. The latest test, which is one of Artek's best results to date, further supports the productivity and liquids potential of the reservoir at the north end of the pool. The well was drilled to a lateral distance of approximately 1,367 meters and was stimulated using a 14 stage hydrocarbon fracture program. The Company is currently drilling out its second 2012 Doig horizontal at Inga which it expects to be completed in May. Subsequent to breakup, the five remaining horizontal wells in Artek's Inga gas/condensate drilling program are planned to be drilled from June through November with all wells anticipated to be completed and on production by year end.
Also in the first quarter of 2012, the Company drilled and completed two additional horizontal wells in the Peace River Arch (PRA) area of Alberta targeting intermediate depth Triassic light oil. The first was completed using a 13 stage hydrocarbon fracture program, and after a 111 hour test period the well was flowing at approximately 149 boe/d (54% light oil) and about 858 bbls of water per day. The second horizontal well was completed using an 11 stage water based fracture program and after 96 hours tested at approximately 180 boe/d (64% light oil) and approximately 810 bbls of water per day. Three horizontal wells on the PRA Triassic oil play have been drilled to date with the average test rate meeting management's expectations at 246 boe/d (130 bopd and 725 mcf/d of rich natural gas) with approximately 1,300 bbls of water per day. The Company disposes the water from the wells at its 100% operated water disposal facility and sends its rich natural gas to a third party deep cut facility where it realizes a further 40 to 50 bbls/mmcf of liquids yield from its rich natural gas. Results to date and Company mapping support an additional 22 to 30 horizontal locations targeting light Triassic oil in the Dunvegan to Cecil corridor of Alberta, where Artek has accumulated over 60 sections (57 net) of land. An additional horizontal well is planned on an undeveloped land block targeting Triassic oil in the PRA in the second half of the year.
In addition, the Company anticipates starting its 4 well (1.6 net) development program targeting Glauconite oil at Leduc Woodbend this summer which is anticipated to be completed in September with production from the property forecast to increase by approximately 100 to 150 boe/d to 500 to 550 boe/d net by year end.
The Company is also pleased to announce that after its semi-annual credit review, Artek's lender has maintained Artek's $60 million operating line of credit plus a $10 million development line for total credit lines of $70 million. Available bank credit together with internal cash flow provides Artek with the financial flexibility to execute its 2012 growth oriented capital program. The next scheduled review date for Artek's credit facility is October 2012.
Artek anticipates releasing its 2012 first quarter results after close of market on May 9, 2012.
Forward Looking Statements: This document contains forward-looking statements. Management's assessment of future plans and operations, future results from operations, production estimates, commodity mix, initial production rates, drilling plans, timing of drilling and tie-in of wells, productive capacity of new wells, number of potential drilling locations, future oil and natural gas prices, capital expenditures and the nature and timing of these expenditures, and financial capacity to carry out its planned 2012 capital program may constitute forward-looking statements under applicable securities laws and necessarily involve risks including, without limitation, risks associated with oil and gas exploration, development, exploitation, production, marketing and transportation, loss of markets, volatility of commodity prices, currency fluctuations, imprecision of reserve estimates, environmental risks, competition from other producers, inability to retain drilling rigs and other services, incorrect assessment of the value of acquisitions, failure to realize the anticipated benefits of acquisitions, the inability to fully realize the benefits of the acquisitions, delays resulting from or inability to obtain required regulatory approvals and ability to access sufficient capital from internal and external sources. As a consequence, the Company's actual results may differ materially from those expressed in, or implied by, the forward looking statements. Forward looking statements or information are based on a number of factors and assumptions which have been used to develop such statements and information but which may prove to be incorrect. Although Artek believes that the expectations reflected in such forward-looking statements or information are reasonable, undue reliance should not be placed on forward looking statements because the Company can give no assurance that such expectations will prove to be correct.
In addition to other factors and assumptions which may be identified in this document and other documents filed by the Company, assumptions have been made regarding, among other things: the impact of increasing competition; the general stability of the economic and political environment in which Artek operates; the ability of the Company to obtain qualified staff, equipment and services in a timely and cost efficient manner; drilling results; the ability of the operator of the projects which the Company has an interest in to operate the field in a safe, efficient and effective manner; Artek's ability to obtain financing on acceptable terms; field production rates and decline rates; the ability to replace and expand oil and natural gas reserves through acquisition, development or exploration; the timing and costs of pipeline, storage and facility construction and expansion; the ability of the Company to secure adequate product transportation; future oil and natural gas prices; currency, exchange and interest rates; the regulatory framework regarding royalties, taxes and environmental matters in the jurisdictions in which the Company operates; and Artek's ability to successfully market its oil and natural gas products. Readers are cautioned that the foregoing list of factors is not exhaustive. Additional information on these and other factors that could affect the Company's operations and financial results are included in reports on file with Canadian securities regulatory authorities and may be accessed through the SEDAR website (www.sedar.com) or at the Company's website (www.artekexploration.com). Furthermore, the forward looking statements contained in this document are made as at the date of this document and the Company does not undertake any obligation to update publicly or to revise any of the included forward looking statements, whether as a result of new information, future events or otherwise, except as may be required by applicable securities laws.
BOE Conversions: Barrel of oil equivalent ("BOE") amounts may be misleading, particularly if used in isolation. A BOE conversion ratio has been calculated using a conversion rate of six thousand cubic feet of natural gas to one barrel. This conversion ratio of six thousand cubic feet of natural gas to one barrel is based on an energy equivalent conversion method primarily applicable at the burner tip and does not represent a value equivalency at the wellhead. Given that the value ratio based on the current price of crude oil as compared to natural gas is significantly different from the energy equivalency of 6:1, utilizing a conversion ratio on a 6:1 basis may be misleading as an indication of value.
Test results and initial production rates: the pressure transient analysis or well test interpretation has not been carried out and thus certain of the test results provided herein should be considered to be preliminary until such analysis or interpretation has been completed. Test results and initial production rates disclosed herein may not necessarily be indicative of long-term performance or of ultimate recovery.
Artek is a crude oil and natural gas exploration, development and production company headquartered in Calgary, Alberta, Canada. Artek's shares trade on the Toronto Stock Exchange under the symbol "RTK".
FOR FURTHER INFORMATION PLEASE CONTACT:
Darryl Metcalfe Artek Exploration Ltd. President and Chief Executive Officer (403) 296-4799
Darcy Anderson Artek Exploration Ltd. Vice President Finance and Chief Financial Officer (403) 296-4775 www.artekexploration.com
The Toronto Stock Exchange has neither approved nor disapproved of the information contained herein.