schwing update

not good - possible reason for recent sell down

Schwing Well Completion Results
Testing of the 12,500' zone in the Spartan Schwing 002 well has been completed, and wireline pressure build-up analyses are being conducted. The zone proved to contain moveable 39 degree gravity oil of good quality with minor associated gas, but was not capable of flowing hydrocarbons at commercial rates. Initial analysis of the pressure build-up data suggest that the 12,500' zone is of very limited permeability, and may also be of limited areal extent. However, it establishes the presence of oil on the feature at this depth, and the lateral equivalents of the zone are still prospective, at the updip positions which are known to be present on the Schwing structure.
The well will be recompleted for production testing of two prospective sands in the Lower Marg Tex section, in the interval 11,800-11,900'. A completion unit will be moved back onto the well, to accomplish this.
Analysis of the results of the well have already indicated that additional drilling on the structure can be justified, regardless of the final outcome of the testing of the Schwing 002. Untested structural closure of at least 300 acres can be mapped, up-dip of the shows and sands encountered in the well. The feature therefore still has exploratory potential for substantial untested oil and gas reserves.