GREY:EWDYF - Post by User
Post by
oilandgaswellson Feb 08, 2011 5:00pm
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Post# 18096994
Cormark and GMP
Cormark and GMPCORMARK
Eaglewood Energy Inc. (EWD - TSXV)
Ubuntu-1 Encounters Gas Condensate Pay - Tuesday, February 08, 2011
Yesterday, Eaglewood announced that its Ubuntu-1 is capable of flowing gas at commercial rates and the well is being suspended as a discovery. The Ubuntu-1 well (40% WI) penetrated at least 10 metres of net gas bearing Elevala Sandstone over the gross interval 3,305 to 3,330 metres measured depth. Wireline pressure testing of six data points in the reservoir shows a condensate rich gas gradient, indicating that the reservoir contains moveable gas and liquids. Most notably, the gas-water contact was not penetrated in Ubuntu-1, indicating the potential for additional gas below the Elevala Sandstone intersection depth. This is a very positive development for Eaglewood as it not only provides the Company with its first discovered resources, but also confirms the prospectivity of the PPL 259 block (90% WI) which contains numerous other prospects. We are reiterating our Buy (S) recommendation and increasing our target to $2.25 from $2.00.
GMP
February 8, 2011
SUBJECT:Eaglewood Energy (EWD CN) makes commercial gas condensate discovery in PPL259
IMPACT: Positive – Ubuntu-1 to be suspended as a condensate rich gas discovery
DETAILS:
·Preparations are underway to suspend the Ubuntu-1 well, in PPL259, after it penetrated ~10 m of net gas bearing Elevala Sandstone over the gross interval 3,305 – 3,330 m MD.
·Initial testing indicates a condensate rich gas gradient and that the reservoir contains moveable gas and liquids at commercial flow rates. Further testing is ongoing in order to establish the full extent of the hydrocarbon column and future appraisal will be required to fully delineate the structure.
·The gas/water contact has not been penetrated, indicating the potential for additional gas below the Elevala Sandstone intersection depth in Ubuntu-1.
·EWD states that the well is located below the trap crest of the Ubuntu structure, which is ~1 km to the west.
·Well partners are EWD 40%, Talisman Niugini 50% and Mega Fortune International 10%.
OUR VIEW:This commercial gas condensate find is a positive result for EWD. But we look towards further testing and appraisal to delineate the discovery and provide long-term positive impact to the stock. The well is targeting ~590 bcf which we carry at C
.70/sh risked and C$2.79/sh unrisked in our published EMV.