time for the big reveal...., page-36

24 October 2011
Target Energy Limited (“Target”) (ASX CODE: TEX) is pleased to provide the following
operations update.
BOA 12 #1 (Fairway Project, Howard County, Texas)
Fusselman Testing
Flow-testing of the Fusselman formation has been completed, with the Fusselman oil
and water production stabilising at a total of 120 Barrels per day (BPD) with a 5% oil
cut (i.e. oil flow was estimated at 6 to 10 BOPD). A bridge plug has been set above
the Fusselman interval to allow the flow to be commingled with the Wolfberry at
some time in the future.
Wolfberry Frac Program
The partners are now proceeding with the design and scheduling of a fracture
stimulation (“frac”) program for the Wolfberry zone.
The frac is expected to take place in two to three weeks’ time and will test the entire
Wolfberry section from approximately 1,920m – 3,000m, including the Mississippian
and Strawn Formations. The exact interval and number of stages in the frac are
presently being determined.
Clear Fork
Plans to test the shallower Clear Fork Formation are also being developed. At this
time it is likely the Clear Fork will be tested separately and after the Wolfberry frac. If
it produces sweet crude (i.e. low or no sulphur content), it will then be commingled
with the Wolfberry production. Recent (2009) Clear Fork drilling in the area by
ConocoPhillips has yielded initial production rates of 60-90 BOPD after stimulation.
San Andres
Potential San Andres oil pay was also encountered, unexpectedly, in the BOA 12 #1
well. Local production from the San Andres Formation is prolific, with the nearby
Howard Glasscock field having produced over 410 million barrels of oil since its
discovery in 1925 - primarily from the San Andres and Grayburg Formations.
As oil produced from the San Andres is typically a sour crude it cannot be
commingled with other production in the BOA 12 #1 well and the partners are
contemplating “twinning” the BOA 12 #1 well by drilling a shallow well adjacent to it
to test and potentially produce the San Andres Formation. In the event that the Clear
Fork crude in the BOA 12 #1 well is also sour and cannot be commingled with the
FAIRWAY PROJECT OPERATIONS UPDATE Corporate information
ASX Code
TEX
TEXOB
Board of Directors
Chris Rowe, Chairman
Laurence Roe, Managing Director
Graham Riley, Director
Stephen Mann, Director
Ralph Kehle, Chairman TELA (USA)
Rowan Caren, Company Secretary
ABN Number
73 119 160 360
Contact details
Level 2, 46 Ord Street
West Perth WA 6005
Tel: +61 8 9476 9000
1900 St James Place, Suite 425
Houston Tx 77056
USA
Tel: +1 713 275 9800
[email protected]
Overview of activities
Target is exploring and producing a
suite of highly prospective oil and gas
projects in the USA.
NOTE: In accordance with ASX Listing
Rules, any hydrocarbon reserves and/or
drilling update information in this report
has been reviewed and signed off by Mr
Laurence Roe, B Sc, Managing Director of
Target Energy, who is a member of the
Society of Exploration Geophysicists and
has at over 30 years' experience in the
sector. He consents to that information in
the form and context in which it appears.
TARGET ENERGY LIMITED (ASX: TEX) | Level 2, 46 Ord Street, West Perth WA 6005
(08) 9476 9000 | [email protected] | www.targetenergy.com.au
ASX Announcement
24 October 2011
Wolfberry production, the twin well will be deepened to accommodate the Clear
Fork production.
While the San Andres flow and reserve potential is still to be tested at BOA 12 #1, it
may be noted that in 2008 local operators successfully sought to downspace the
drilling at the Howard Glasscock field to 5 acres, citing the ability to recover up to
175,000 BO from new infill locations (equivalent to 280,000 BO per 40 acres).
Managing Director Laurence Roe commented, “While the Fusselman production in
this particular well has proved to be sub-economic, we still have considerable
potential for this formation elsewhere in our acreage and we will continue to drill
and test it in all of our future Fairway wells. It remains a very attractive target. In the
meantime we have completed it in this well in such a way that it can be commingled
with the Wolfberry production when regulations allow.
“The next step is the Wolfberry frac in a few weeks and then the testing of the Clear
Fork Formation. We are also very excited about the San Andres potential in this part
of the Fairway Project area and we are looking at our options to accelerate a San
Andres well.”
Target Energy is earning a 60% Working Interest in the Fairway project.
ENDS
For and on behalf of TARGET ENERGY LIMITED