Pekisko PrizeCrew's 2009 Princess Pekisko drilling program was very successful adding in excess of 7 million boe of proved plus probable reserves and increasing the Princess proved plus probable reserves by 87% to 15.1 million barrels at a cost of $8.19 per boe. Crew has plans to drill up to 30 (30.0 net) horizontal wells at Princess in 2010 with 13 horizontal wells now planned in the first quarter of 2010.
Crew's operating costs at Princess are expected to continue their downward trend from $16.50 per boe when the property was acquired to the $10 per boe range in 2010. The majority of this reduction is attributed to successful drilling of horizontal disposal wells in the Devonian Cairn formation the last two of which each tested at disposal capacity of 9,000 barrels per day. Crew continues to expand and modify its existing infrastructure to facilitate the Pekisko production growth.
What is happening here is a major resource play, crew is drilling horz wells with a cost of 1.1 million dollars a well that are producing approximately 100,000 barrels in there first year of production. With about 500 sections of land in the area and 8 well per section they is the potential for a hudge resource play. They say they are going to drill 13 wells in the first quater, and up to 30 for the year. My guess is depending on the first quater results they may only want and drill in Princess for the remainder of the year.
Crew has been very successful with its recompletion and drilling program at Princess resulting in a 64% increase in production to over 3,600 boe per day with several wells on maximum rate limitations ("MRL") awaiting approval of Good Production Practice ("GPP") applications. The Company was active drilling wells at Princess in the third quarter, drilling six (6.0 net) horizontal oil wells and one (1.0 net) water disposal well. Production from existing wells continues to be positive as the 8-8 horizontal well has now produced 97,000 barrels of oil in the first year and continues to produce at approximately 240 bopd. The 11-4 vertical well has produced over 100,000 barrels of oil and continues to produce at over 310 bopd. Three recompletions at Princess each continue to produce at 105 to 230 bopd and three out of six third quarter wells are now on production and are exhibiting initial production rates averaging over 250 bopd.