Calgary, Alberta — Questerre Energy Corporation (“Questerre” or the “Company”) (TSX,OSE:QEC) is pleased to report on the test results from its 16-07-62-5-W6M well (the “16-07 Well”) in the Kakwa-Resthaven area of west central Alberta.
The 16-07 Well was completed with a ten-stage slick water fracture stimulation in the approximately 1000m horizontal leg. Over the last 24 hour period of the cleanup and flow back, the well averaged 3.5 MMcf/d of natural gas with condensate rates of approximately 50 bbls/MMcf. The well was continuing to clean up completion fluids. Sour gas was measured at less than 0.003% during testing. The well was flowing up 4.5 inch casing with a flowing casing pressure of approximately 6500 kPa.
Michael Binnion, President and Chief Executive Officer, commented, “We are very pleased with these results that have met and exceeded our expectations about total liquids. Our main concerns for this block were the presence of sour gas and condensate. The 16-07 Well has confirmed only trace sour gas, or essentially no sour gas, that we can handle at surface and condensate rates that are in line with the offsetting industry wells. Based on the gas analysis, we expect to recover approximately an additional 20 bbls/MMcf of natural gas liquids through processing at a third party shallow cut processing plant that would improve our economics.”
The 16-07 Well will be equipped and tied-in to a shallow cut third party processing plant shortly. The Company has licensed two additional wells on its Kakwa South acreage which include laterals of between 1200m and 2000m. The Company is currently contracting a triple rig and, subject to rig availability, expects to spud its next well in September. Questerre holds a 100% interest in the 16-07 Well and ten sections of land in this area.
While the initial test rates from the 16-07 Well are encouraging, the Company notes that they are not indicative of the long-term performance or the ultimate recovery from this well.
The Company also reported on the status of the three wells recently completed on its joint venture acreage, approximately six miles to the north of the 16-07 Well. The 02-18-63-5-W6M well, the 08-20-63-5-W56M well and the 09-20-63-W6M well (collectively the “New Wells”) were each drilled with lateral legs of approximately 2000m and completed with slick water fracture stimulations. Flowback and cleanup took longer due to the higher volumes of completion fluids used for these wells. The New Wells were drilled and completed on time and budget.
Mr. Binnion added, “Along with the operator, we too are very encouraged by the results from these wells. Condensate rates are consistent with our existing wells. The initial flowing pressures and gas rates are strong and, based on these results, we expect all our future wells will have laterals of 1.5 miles.”
The operator reported that it will release initial 30 day production volumes from the New Wells when available.
The operator further reported that the New Wells are being equipped and tied-in and should be on production next month. Production from the New Wells and existing wells will be shut-in in the middle of September for approximately two weeks during a scheduled turnaround at the third party processing plant. As a result, the Company expects the New Wells to be consistently onstream in October.
Questerre Energy Corporation is leveraging its expertise gained through early exposure to shale and other non-conventional reservoirs. The Company has base production and reserves in the tight oil Bakken/Torquay of southeast Saskatchewan. It is bringing on production from its lands in the heart of the high-liquids Montney shale fairway. It is a leader on social license to operate issues for its Utica shale gas discovery in the St. Lawrence Lowlands, Quebec. In conjunction with a supermajor, it is at the leading edge of commercializing a proven process to unlock the massive resource potential of oil shale.
Questerre is a believer that the future success of the oil and gas industry depends on a balance of economics, environment and society. We are committed to being transparent and are respectful that the public must be part of making the important choices for our energy future.
For further information, please contact:
Questerre Energy Corporation
Anela Dido, Investor Relations
(403) 777-1185 | (403) 777-1578 (FAX) |Email: firstname.lastname@example.org
This media release contains certain statements which constitute forward-looking statements or information (“forward-looking statements”) including the expectation of additional recoveries through a third party shallow cut processing plant for the 16-07 Well, the expectation of the spud date for the Company’s next well, the expected commencement date of production from the New Wells. Although the initial rates from the 16-07 Well are very encouraging, production test results are not necessarily indicative of long-term performance or ultimate recovery from this well. Although Questerre believes that the expectations reflected in our forward-looking statements are reasonable, our forward-looking statements have been based on factors and assumptions concerning future events which may prove to be inaccurate, including the timing of pricing and terms of the placement, the placement results and closing, the use of net proceeds, the timing of receipt of required regulatory approvals and assumptions concerning the success of future drilling activities. Those factors and assumptions are based upon currently available information available to Questerre. Such statements are subject to known and unknown risks, uncertainties and other factors that could influence actual results or events and cause actual results or events to differ materially from those stated, anticipated or implied in the forward-looking statements. As such, readers are cautioned not to place undue reliance on the forward looking information, as no assurance can be provided as to future results, levels of activity or achievements. The risks, uncertainties, material assumptions and other factors that could affect actual results are discussed in our Annual Information Form and other documents available at www.sedar.com. Furthermore, the forward-looking statements contained in this document are made as of the date of this document and, except as required by applicable law, Questerre does not undertake any obligation to publicly update or to revise any of the included forward-looking statements, whether as a result of new information, future events or otherwise. The forward-looking statements contained in this document are expressly qualified by this cautionary statement.
This news release is not an offer of securities for sale in the United States. Securities may not be offered or sold in the United States or to or for the account or benefit of US persons (as such terms are defined in Regulation S under the United States Securities Act of 1933, as amended (the “U.S. Securities Act”)), absent registration or an exemption from registration. The securities offered have not been and will not be registered under the U.S. Securities Act or any state securities laws and, therefore, may not be offered for sale in the United States, except in transactions exempt from registration under the U.S. Securities Act and applicable state securities laws. This news release shall not constitute an offer to sell or the solicitation of an offer to buy nor shall there be any sale of the securities in any State in which such offer, solicitation or sale would be unlawful.
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 of oil and the conversion ratio of one barrel to six thousand cubic feet is based on an energy equivalent conversion method application at the burner tip and does not necessarily represent an economic value equivalent 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 equivalent of 6:1, utilizing a conversion on a 6:1 basis may be misleading as an indication of value.