To all the gloom and doom people - the main value of Pinecrest is the land + infrastructure.
Penn West is making comments each quarter about their view of the slave point in areas that
border the pinecrest's acreage. those comments on this release are becoming more optimistic
and that should increase the value of the company for farm out or sale.
Anyway, everyone is so gloom and doom while the people who are actually derisking the play
are moving along and are substantiating the land's value.
Lets hope for the best.
Penn west comments are bellow:
Slave Point
We continue to test various drilling and completions techniques in the Slave Point Carbonates, as we focus on optimizing production performance, recoveries, cycle-times and per well costs. Throughout the second quarter of 2014, we continued to monitor the results of our drilling program from earlier in the year. We spent development capital of $16 million in the second quarter.
In Otter, production performance on our first long-reach (3,200 meter) lateral wells is in-line with expectations. We are now monitoring these wells for longer-term performance before broader implementation of this design. In the Red Earth area, the two wells we drilled in the first quarter of 2014 continue to perform above our expectations. In Sawn, the results of our first nitrogen fracture wells experienced average 30-day initial production rates that significantly exceeded our type curve. As in Otter, we are now monitoring these wells for longer-term performance.
Our second half 2014 development activities in the Slave Point include a selective seven well drilling program which began in July, five of which are anticipated to be on production by the end of 2014. The goal of this program is to continue with assessment of each of the areas within the Slave Point, testing various drilling and completions techniques. To be competitive internally, per well drilling and completion costs need to be $4.5 million or lower. Currently, average per well drilling and completion costs in our Slave Point program are running in the $5.1 million range. We believe the required 12 percent reduction in costs is achievable and that the Slave Point will be a significant component of our development program in future years as communicated in our long-term plan.