NEWS: Ivanhoe & Derek to expand oil recoveryFINALLY!!! CONFIRMATION THAT THE PROJECT IS MOVING FORWARD AND THE LONG AWAITED ~CONTINUOUS STEAMING~
Ivanhoe, Derek Oil to expand oil recovery at LAK Ranch
2005-06-14 08:37 ET - News Release
See News Release (C-IE) Ivanhoe Energy Inc
Ms. Cindy Burnett of Ivanhoe reports
IVANHOE ENERGY AND DEREK OIL & GAS PROVIDE UPDATE ON LAK RANCH PROJECT
Ivanhoe Energy Inc. and Derek Oil & Gas Corp. have agreed to expand the enhanced oil recovery pilot program at the LAK Ranch field in Weston county, Wyoming.
The pilot steam flood in the LAK Ranch field will be expanded with the drilling of three steam injection wells. This expansion follows completion of a 3-D seismic survey of the area and a thorough interpretation of the survey results. The new wells will provide for continuous injection of steam above the existing horizontal wells. The pilot program to date has consisted of three cycles of steam injected into a horizontal producing well. Temperature has been monitored in an adjacent horizontal well, located approximately 25 feet above the injection well. Oil production has increased with each cycle and is currently about 20 barrels per day following the third steam cycle.
The LAK Ranch field, originally discovered in the 1920s, covers approximately 7,500 acres in the Powder River basin. Thirty wells have been drilled by several operators to define the significant oil in place for this project, and a number of small-scale attempts have been made to economically recover the oil. Ivanhoe Energy believes the use of horizontal wells and continuous steam injection offers the most promising chance of success and some encouraging results have been achieved to date. The pilot expansion is expected to be completed by August pending drill rig availability.
Ivanhoe Energy currently holds a 39-per-cent interest in the project and Derek Oil & Gas holds 56 per cent, with 5 per cent held by another party. Following the pilot phase, Ivanhoe Energy has the option to increase its working interest to 60 per cent by providing additional capital toward the initial development phase for a total of $5-million (U.S.), including the amounts spent on the pilot phase. Should Ivanhoe Energy elect not to proceed beyond the pilot phase, its working interest will be reduced to 15 per cent and Derek Oil & Gas will become the operator.
Derek Oil & Gas is an oil exploration and development company with its key asset the LAK Ranch in northeastern Wyoming. Through enhanced oil recovery (EOR) methods, Derek's joint venture partner, Ivanhoe Energy (operator), provides the technical expertise for this project. Derek's main focus is to increase shareholder value through higher levels of oil production at the LAK Ranch project.
Derek Oil & Gas trades in both Canada on the TSX Venture Exchange under the symbol DRK and in the United States of America on the OTC Bulletin Board under the symbol DRKOF.
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