nsa nearfield 12,000 acres, page-12

Thanks T-Shirt, Just a recap on the recent announcment If anyone was interested.

Neon Energy (ASX: NEN) has acquired a lightly explored lease adjacent to its producing North San Ardo oil field in California that could provide incremental production increases.

The Glau Lease is directly north of North San Ardo and has had just one stratigraphic test well drilled and limited seismic coverage.

This well confirms the presence of moveable oil within the reservoir interval that produces at North San Ardo while the seismic data suggests the field may extend into the Glau Lease.

This provides an excellent opportunity for Neon to add incremental production by drilling low cost wells similar to those drilled in the Lombardi Lease, where initial production rates of up to 1,000 barrels of oil per day were achieved from individual wells.

The 100% owned Glau also contains additional exploration leads in the east, offering relatively low risk upside to complement existing production from North San Ardo.

Neon has already started preparations for a 2D seismic survey that will delineate targets within the Glau and Rancho Rico leases for a forthcoming drilling campaign.

Exploration success in these leases will provide the company with incremental reserves, production and revenue that will offset the natural decline of North San Ardo, where production is currently constrained due to issues with one of the two water injection wells.

Neon is working on a number of fronts to remove this bottleneck, while at the same time nearing completion of a significant facilities upgrade that will improve operating efficiency over the coming years.

This upgrade provides a foundation for a continued program of secondary production enhancement, aimed at maximising the ultimate recovery from the field. This includes continued cyclic steaming, which has yielded encouraging results to date, in addition to a number of other initiatives aimed at increasing field-wide oil production by reducing the amount of formation water produced.





http://www.proactiveinvestors.com.au/companies/news/34095/neon-energy-targets-more-oil-production-with-new-california-lease-34095.html