Phase 2 (ASE 18 1H)
Valued Partners,
Below is the most recent update from Deane Pierce on the ASE 5 1H (Phase 1):
Since the last update, we have been drilling our horizontal well path in the 6-1/4” hole section to 10,582 ft and are presently tripping for a new bit. Drilling in the 6-1/4” hole will continue until we have reached the 5,000 ft horizontal well bore, placing us midway into the Granite Wash “G Bench” target formation.
Daily drilling fluids engineering continued with 24-hour on-site supervision. Lost circulation preventative material and chemicals are being added to maintain optimum fluid properties and avoid lost circulation. We have been “geo-steering” the horizontal leg with real-time Gamma Ray logs fed via satellite link to the G&G experts who “guide” the directional drillers for path corrections. Wayne Beninger is supervising this process. In addition, we have experienced “mud loggers” on location collecting formation samples as well as gas readings. We are seeing florescence in the cuttings indicating oil saturation as well as good gas readings.
Once we have drilled the horizontal leg, we will set 4-1/2” production casing and cement it. When the cement is fully cured, we will perforate the various stages to prepare the well for a frac job. We have upgraded the 4 ½” specifications in order to pump more fracturing fluid at a higher pressure based on offset well analysis. We met with and committed to Hadaway Engineering for the completion services and are presently finalizing the frac design with Quasar to lock-in the number of stages and optimize the stimulation of the Granite Wash based on Hadaway’s extensive experience in the area. We will increase the number of stages to 20 and increase the amount of fluid and sand to be pumped. We are still estimating between 500 to 750 barrels of oil per day initially based on offset vertical wells as well as data from a number of horizontal wells on the ranch. Hadaway thinks we will meet this target or exceed it by expanding the number of frac stages and increasing sand/fluid volumes.
Hadaway has begun a review of the existing facilities to determine any repairs/upgrades needed. We hope to have all of this installed for the frac flowback so we can begin selling oil and gas almost immediately. We continue to meet with the gas gathering company and will finalize the gas contract and gas line specifications with them in the coming weeks. We have received bids for water hauling and disposal of produced fluids and are in the process of seeking an oil sales purchaser.
