Jones #1 Woodford Shale well ( KTE 28%)Completion update.K2...

Jones #1 Woodford Shale well ( KTE 28%)
Completion update.
K2 Energy Limited (ASX-KTE) is pleased to announce that the Completion and
fracture treatment first horizontal appraisal well to test the Woodford shale in the
current drilling program on its Bad Creek Project in Oklahoma commenced this week.
The first of four planned fracture treatments on the 2200 ft lateral zone in the
Woodford Shale commenced this week with the final and 4th frac scheduled to be
completed by the end of August with production testing expected in early September.
Multistage Fracture stimulation techniques applied successfully by other operators in
the Woodford play adjacent to the Bad Creek project area will be applied by the
company.
The Jones #1 well is the first of several planned wells to test the Woodford and
Caney shale resource of up to 81BCF net to KTE of gas outlined by Netherland
Sewall & Associates in its Independent Experts Report announced on 13th May 2008.
Farm out
K2 Energy has farmed out part of the additional 13% interest in the Jones #1 well
that was its additional entitlement pooled acreage secured via the forced pooling
process of the Oklahoma Corporations Commission announced in the June Quarterly
report.
K2 Energy’s working interest in the Jones #1 has increased to 28% from the original
25% interest after farming out a 10% of the additional interest to Ainsworth Holdings
Inc. of Houston Texas on favorable terms.
Woodford / Caney Shale Play – Arkoma Basin Oklahoma
The Woodford / Caney Shale play is now proven and one of the fastest developing
unconventional gas plays in the United States with many large independent such as
Newfield Exploration, Devon Energy, Southwestern Energy, XTO, Petrohawk Energy
and others all mounting aggressive drilling programs on the back of many successful
wells in the adjoining areas. To date Woodford Wells in the play have consistently
produced 1.0 - 3.4 million cubic feet of gas per day with reserves of 2-4 BCF of gas
per well being booked.
In July oil giant BP Plc. acquired 90,000 acres and multiple producing
Woodford wells in the Woodford play in Oklahoma from Chesapeake Energy
Corp for $1.75 Billion. This acquisition confirms the status of the Woodford play as
one of the booming unconventional shale plays in the United States.
Level 2, Kyle House,
27 Macquarie Place,
Sydney, 2000
Aust ralia
62 2 9251 2254
61 2 9251 6550 fax
k2energy.com.au
K2 Energy has ~ 5800 net acres in its Bad Creek 3D seismic project area in
Oklahoma which has both Woodford and Caney shale gas potential and the
company proposes to prove up the acreage with several horizontal Caney and
Woodford test wells planned at Bad Creek. The company has both Caney and
Woodford production from several vertical wells at Bad Creek.