Ivanhoe Energy updates status of California deep gas well testing
Tuesday December 6, 8:22 am ET
BAKERSFIELD, CA, Dec. 6 /PRNewswire-FirstCall/ - Ivanhoe Energy Inc. (NASDAQ: IVAN and TSX: IE, IE.U) announces that the Aera Energy LLC Northwest Lost Hills 1-22 deep well has been successfully completed to a depth of 20,870 feet in preparation for testing potential natural gas formations starting in early January. Ivanhoe Energy has a 28% working interest in the project, but is fully carried for the cost of the test phase.
ADVERTISEMENT
"Completion activities on this deep well, in a highly over pressured formation, were handled extremely well by Aera," said Leon Daniel, Ivanhoe Energy's President and CEO. "Natural gas shows were encountered in three different zones when the well was originally drilled and indications from the completion activities are very encouraging. Natural gas was encountered and flared during clean out of the well and the pressure, both downhole and at the surface, is extremely high. Now that the downhole equipment has been successfully run, we expect testing to commence early in the New Year, once all of the surface testing equipment is hooked up."
Completion activities were resumed in September 2005 on the NWLH 1-22 well. The open hole interval below 19,620 feet was cleaned out and a perforated production liner was successfully run to a depth of 20,870 feet. A production tubing string has been placed in the well. With the high mud weights required to control the well, the pressure in the reservoir is indicated to be extremely high. The drilling rig has moved off and a tree with a 15,000 pound per square inch pressure rating has been installed at the surface.
Ivanhoe Energy originally had a 42% interest in the 9,600-acre block, but farmed out a portion of its ownership in exchange for testing of the well. Ivanhoe Energy's costs are being carried through the initial completion and testing phase by other partners in the venture. If the test, which could take up to one month, indicates commercial quantities of natural gas and/or natural gas liquids, Ivanhoe Energy will participate with its 28% working interest.
The well is in Kern County, California and is operated by Aera Energy LLC. This well, designed to evaluate the natural gas and condensate reserve potential of the deep Temblor formation, began drilling in August 2001 and reached a depth of 21,000 feet in August 2002 after substantial delays and cost overruns resulting from difficult drilling conditions. While drilling, several high-pressure intervals which indicated the presence of natural gas were encountered. Casing was set to 19,620 feet in preparation for testing; however, operations were suspended by the operator in 2002 while a partner was sought to share the costs of the testing program.
Ivanhoe Energy is an independent international oil and gas exploration and development company building long-term growth in its reserve base and production. Ivanhoe Energy is a leader in technologically innovative methods designed to significantly improve reserves of oil and gas through the upgrading of heavy oil to light oil, state-of-the-art drilling techniques, enhanced oil recovery (EOR) and the conversion of natural gas to liquids (GTL). Core operations are in the United States and China, with business development opportunities worldwide.
Ivanhoe Energy trades on the NASDAQ Capital Market with the ticker symbol IVAN and on the Toronto Stock Exchange (TSX) with the symbol IE. On the TSX, Ivanhoe Energy is listed and traded in both Canadian and U.S. dollars. The U.S. dollar trading symbol on the TSX is IE.U.
Information contacts:
---------------------
All locations: Cindy Burnett 1-604-331-9830 (North America)
In Asia: Patrick Chua 86-1370-121-2607 / 852-9193-4056
Website:
www.ivanhoe-energy.com
FORWARD-LOOKING STATEMENTS: This document includes forward-looking statements, including forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Forward-looking statements include, but are not limited to, statements relating to the continued advancement of Ivanhoe Energy's projects, estimates of reserves and production, the potential commerciality of the Northwest Lost Hills 1-22 deep well and other statements which are not historical facts. When used in this document, the words such as "could," "plan," "estimate," "expect," "intend," "may," "potential," "should," and similar expressions relating to matters that are not historical facts are forward-looking statements. Although Ivanhoe Energy believes that its expectations reflected in these forward-looking statements are reasonable, such statements involve risks and uncertainties and no assurance can be given that actual results will be consistent with these forward-looking statements. Important factors that could cause actual results to differ from these forward-looking statements include the potential that the company's projects will experience technological and mechanical problems, geological conditions in reservoirs may not result in commercial levels of oil and gas production, the availability of drilling rigs and other support services, uncertainties about the estimates of reserves, environmental risks, changes in product prices, our ability to raise capital as and when required, competition and other risks disclosed in Ivanhoe's Annual Report on Form 10-K filed with the U.S. Securities and Exchange Commission on EDGAR and the Canadian Securities Commissions on SEDAR.
RESERVES DATA AND OTHER OIL AND GAS INFORMATION: Ivanhoe Energy's disclosure of reserves data and other oil and gas information is made in reliance on an exemption granted to Ivanhoe Energy by Canadian securities regulatory authorities, which permits Ivanhoe Energy to provide disclosure in accordance with U.S. disclosure requirements.
The information provided by Ivanhoe Energy may differ from the corresponding information prepared in accordance with Canadian disclosure standards under National Instrument 51-101 (NI 51-101). Further information about the differences between the U.S. requirements and the NI 51-101 requirements is set forth under the heading "Reserves, Production and Related Information" in Ivanhoe Energy's Annual Report on Form 10-K.
--------------------------------------------------------------------------------
Source: Ivanhoe Energy Inc.
RK and OTCBB: DRKOF) have commenced continuous steaming operations at the enhanced oil recovery pilot program at the LAK Ranch field in Weston County, Wyoming. Oil production from the pilot producing well has increased from 10 barrels per day to 60 barrels per day during the initial six days of continuous operations. The oil is currently being sold for approximately US$57/barrel.