WR reviews recent well operations2005-10-27 18:28 ET - News Release
Mr. Randy Buchanan reports
WATCH ACTIVITY UPDATE
Watch Resources Ltd. is releasing the following items to update its recent activity.
Dewberry property
The 2-16 well has been completed as a gas well, and the company is waiting on the final approval from the energy regulator (the EUB) regarding the gas over bitumen application. The company is negotiating with various facility owners in order to secure space to tie in the gas well for production and sales and currently expects delays in bringing this well on production.
Fishing Lake property
The 5-10 gas well drilled earlier in the year was perforated in August to establish economic rates and provide the necessary information to obtain the gas over bitumen production application, which has been approved by the EUB. This pipeline tie-in has been surveyed, and easements have been acquired to facilitate gas production to a third party facility. The pipeline and on site facility construction is anticipated to commence by the end of October with production anticipated to begin prior to the end of November, 2005.
The 10-18 gas well drilled earlier in the year is standing cased, awaiting completion and testing, but the company has not been able to access the site due to extremely wet conditions. Once freeze-up occurs -- likely in mid-November -- the well will be accessible and completion work will begin. The well is approximately 2.2 kilometres from a third party tie-in facility.
The 14-29 and 12-31 heavy oil wells are currently being completed and equipped for heavy oil production and is anticipated to begin producing shortly.
The company's 2005, 61-kilometre 2-D seismic program was shot and recorded in August, and continues to be evaluated. The seismic and geological evaluation has identified two new drilling locations which were drilled in the recent three-well program and discussed below. Two additional gas test well locations are currently being surveyed and are pending regulatory approvals. These two wells are scheduled to be drilled prior to year-end.
The 2-23 well and 4-18 well are recently drilled gas test wells which have been logged, cased and pending completion in the next few weeks. The company has a service rig contracted to complete all the service work on the property. Provided the wells prove to be economic, they will be tied in to nearby facilities, once the EUB approvals are issued. Both locations are within 1.5 kilometres of a third party tie-in facility.
The 15-36 well which was recently drilled for both gas and underlying heavy oil targets, has been logged, cased and is awaiting completion as a heavy oil well. In the event the well is economic for heavy oil production, a twin well will be drilled to exploit the gas zone encountered.
Consistent with the company's agreement with the Fishing Lake Metis settlement and Metis Settlements General Council (collectively, the Metis) the Metis have been provided their notice to elect participation on the most recently drilled three wells, with such election pending. The Metis did elect to participate in the prior program for a 12.5-per-cent working interest in the 12-31, 10-18 and 5-10 wells. The Metis chose not to participate in the 14-29 well.
The company is very encouraged with the drilling success to date and 2-D seismic results, and believes it now has a strong platform and essentials to continue to exploit its land, bring on new production and build value.
The company will provide information periodically when material news surrounding any of the wells production rates are established and stabilized.