The following is a late explanatory post and was not intended...

The following is a late explanatory post and was not intended as a consolation offering for Elk stayers.

The early oil production history of Grieve resulted in the existing gas cap expanding as the oil was produced and the reservoir pressure declined. As a consequence, the oilwells higher on the Muddy structure became part of the gas cap as it expandedand what were oil producers were shut-in as they became gas producers (topreserve reservoir pressure). The sequence  of the shut-in of the up-dipwells and the depths (above sea level) of their top perforations were asfollows:

 

	Well	Depth of Upper Perfs (ft)	Shut-in date
1	#7	557	Jun-59
2	#13	446	Nov-59
3	#9	401	Nov-59
4	#10	406	Dec-59
5	#21	349	Jul-60
6	#11	307	Aug-60
7	#22	359	Mar-61
8	#23	379	Mar-61
9	#20	349	Jan-62
10	#5	265	Feb-62
11	#4	218	Mar-62

The gas cap did not extend to the wells below #4 and they not continued to produce oil (and water).
 

By 1964 when ForestOil Corporation started to recycle solution gas, the reservoir pressure haddeclined by about 1,000 psig. It was stabilized around 2,000 psig by recyclingthe produced solution gas and with the influx of formation water. First waterwas produced in October 1960, six years after first oil production in September1954. 

 

The solution gaswas processed to remove light ends so that the re-injected gas waspredominately methane which would have had the effect of reducing the residualoil remaining in the expanding gas cap. The recycled gas was injected into the two gascap wells (Grieve #12 and #30 with top perfs at 868’ and 713’ resp.). Recyclinga relatively liquid dry gas could be expected to reduce the residual oilconcentrations in the gassed out oil wells highest on structure (Grieve #7)first and progress down the reservoir. This could explain why the EOR responsefrom #7 is trailing that of #9 in the following plots i.e. the residual oilconcentration at #9 is greater than at #7.  The residual oil concentrationmeasured at Grieve #11 in 2007 was approximately 35% suggesting the recycled gas had little orno effect on reducing the residual oil concentration at #11 which wasoriginally an oil well that was shut-in (Aug 1960) as the gas cap expanded to it.

 

Once it was decidedthat Grieve oil production was no longer economic, Forest  produced the gas cap and subsequently blew down the reservoir (pressure). Any remaining mobile oil would have been carried into the now shrinking gas cap ahead of the advancing water thus re-saturating the lower, previously shut-in gassed out oil wells. Gas production came to an end in 2003 and the field was held by oil production from Grieve #9 which had been placed back on oil production in 1983. The average production and water cut from oil production from Grieve #9 for the last 12 months before the field was shut-in in preparation for the CO2 flood was 9.6 BOPD and 99.3%. The December 2018  production and water cut for #9 were 67.5 BOPD and 98.4% while Grieve #7 figures were 39.1 BOPD and 98.0%.  These are trends in the right direction which presumably, have continued into January and Grieve production can be expected to improve as the CO2 progresses into the reservoir and contacts the richer residual oil concentrations at wells lower in the reservoir.

The following plots are the trends of Grieve production up to and including December.

 

Ignoring the earlier BS figures Denbury provided to WOGCC for #10, #7 and #13, the current trends (production and watercuts for November to December) is in the right direction. Grieve is still expected to provide a verypositive CO2-EOR outcome albeit two years late because of Denbury's management. The early gravity stable response fromproduction of the up dip wells has been tempered by the fact that the residualoil saturation of those up dip wells was possibly reduced by the previousrecycling of processed solution gas.

 

If Grieve’s Januaryfigures are following the December trend, (200 BOPD reported in the 23 Jan. ASX announcement versus 142 BOPD average for December) it would be very useful for Elk to releasethat information now rather than have shareholders wait until the end ofFebruary for its release with all of Wyoming's oil and gas January production figures by WOGCC.