highway 71, page-16

Here's what I think is going on: They always attempt to get an economic flow from the lowest zone first. If uneconomic in that zone, they systematically move up the hole, testing each zone that logged presence of hc's in turn until they get an economic flow. They then complete that zone for production, leaving any further up-hole zones uncompleted until such time as the lowest producing zone is exhausted. Their final op report (see below) showed that the lowest zone looks marginal, although quite thick @22.9m, but w low permeability and possible water. This will take a while to confirm, especially if it started out flowing at marginal rates. They would take longer with the testing to see if flows dwindled away/were sustainable over time/improved over time (yes, this can happen). I think that explains the current delay. They won't want to announce low flow rates unless they really need to, although to get the max payback on the well they will want to produce each zone that can flow, even if rates are low.

What I think they'll WANT to announce is something like: "lowest zone was not capable of acceptable flowrates over time so we have tested/completed the well in the next zone (6.4m 1st Meek B Sand) and achieved X rate of flow".

For my part, I'm hoping that the lowest interval DOESN'T flow because cashflow would be stronger with higher flow rates. I'd then like them to drill a series of shallow wells across the H71 acreage into the Cook Mtn Fm (I think that was the unexpected shallow gas zone) and produce them like there's no tomorrow. That would give them the best SHORT-TERM result. They could then re-enter and deepen these wells later to tap the lower zones.



Formation Comments
Cook Mountain 9 metres of net gas pay
Upper Wilcox 4.9 metres of net gas pay
1st Meek Sand gas charged sand - appears tight
1st Meek B Sand 6.4 metres of net gas pay
2nd Meek Sand 22.9 metres of lower permeability hydrocarbon-bearing reservoir (with possible water cut)


That's my five bobs worth.