High North Resources Ltd. (
TSX: V.HN,
Stock Forum) has begun receiving sales revenue from the company's first two Montney horizontal wells.
Wells 9-2-76-21W5M and 16-2-76-21W5M are flowing oil with combined preliminary rates exceeding a total of 350 barrels of oil per day over a seven day period. In addition, the solution gas is being flared after recovery of a nominal amount of condensate.
According to the
High North press release, rates have been restricted due to surface facility constraints. In addition, both wells are still in their clean-up period, with 30% to 60% of their frac water remaining to be recovered. Once surface facility constraints have been resolved and the remaining frac water has been recovered, specific flow rates for each well will be released.
The company is proceeding to equip both wells with pumping equipment and additional tankage.
A third Montney horizontal well located at 9-26-75-21W5M also produced oil after completion, but is currently shut-in to conduct a pressure build-up survey as required by the Alberta Energy Regulator (AER). Production testing is slated to commence in the later part of February 2014.
High North is an exploration-stage company developing oil and gas properties.
On Wednesday, High North lost 4.8% to $0.495 a share. The company had a market cap of $25.1 million, based on 50.6 million shares outstanding.