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| Gift Lake
On June 26, 2009 the Company completed an acquisition of working interest in five producing oil wells as well as a 12.5% gross overriding royalty in a sixth well. All the oil wells are producing . The property produces about 35 boe's per day.
Northern Alberta Farmouts
On September 29th, 2011 Georox signed two separate Farmout Agreements in two different areas in northern Alberta with a Company in Alberta.
The first Farmout includes one section of land (640 Acres) in northern Alberta with the potential of high productivity light Devonian oil. Georox will drill, complete and equip the earning Exploration well with 75% working interest (bpo= before payout) to earn 45% working interest (apo=after payout) in the balance of the Farmout lands. The contract depth is 2,470m and the estimated cost to drill, complete and equip is approximately $1.25MM. An area of mutual interest of 1 mile around the section of land is also part of the Agreement. There is 3-D seismic support available as well as a geological cross section supporting the play. Georox is the designated Operator of the well and the deadline to drill this well is March 1st, 2012.
The second Farmout includes one-half section of land (320 Acres) in northern Alberta also with the potential of high productivity light Devonian oil. Georox will drill, complete and equip the earning Exploration well with 75% working interest (bpo= before payout) to earn 45% working interest (apo=after payout) in the balance of the Farmout lands. The contract depth is 2,140 m and the estimated cost to drill, complete and equip is approximately $1.25MM. An area of mutual interest of 1 mile around the section of land is also part of the Agreement. There is 2-D seismic support available as well as a geological cross section supporting the play. Georox is the designated Operator of the well and the deadline to drill this well is April 1st, 2012.
Silverdale Property
GP Channel Project
On September 25, 2009 the Company signed a farm-out agreement with a Company in Alberta at the cost of $650,000. This enabled the Company to earn a 15-per-cent interest on farm-out lands consisting of 1,040 acres located in Saskatchewan. The farm-out lands have both 2-D and 3-D seismic support as well as a geological cross-section analysis which verifies the Mannville channel play. Three-dimensional seismic confirms the presence of an undeveloped, deep-cut oil-bearing Mannville channel. Based on analogous wells drilled into similar Mannville channels, reserves in excess of 100,000 barrels per well are potential. The joint venture partners have identified a total of approximately 14 to 18 horizontal oil wells in this play. The pooling of the lands with an adjacent producer (Husky Energy) to form a larger area of common interest has been completed. The 3D Seismic program , interpretation and Pooling has now been completed with an adjacent partner (Husky, the designated Operator) which will yield a pooled working interest of 6.9% to Georox. The drilling of four (4) horizontal wells will commence in the fourth quarter of 2011 at a gross cost of $4,700,000 ($350,000 net to Georox). After an evaluation period, a further 14 horizonal wells will be drilled in the summer of 2012.
Sparky Non Channel Project
Through its Joint Venture Partner (Northern Blizzard), the Company has drilled, cased, and equipped seven wells in the initial drilling program.
Gross production for the seven wells during the month of September was 58 m3/d (363 bopd) and Georox's 15% interest share is = 8.7 m3/d (55 bopd).
The Company has earned its 15% interest on the farm-out lands consisting of 1040 acres at a cost of $600,000 following the completion of the wells.
Officially there are plans to drill a further 2-4 wells late in the fourth quarter of 2011. Georox recently received AFEs' for two wells to be drilled. Typical recoveries are in the order of 100,000 bbls per well.
Kiskoty Property
On June 16, 2010 the Company signed a farm-out agreement with a company in Alberta for $220,000. This will enable the company to earn a 25-per-cent working interest in the farm-out lands, which consist of 160 acres located in the Lloydminster area of Northern Alberta. The overall plan is to re-enter, recomplete/work over, equip and produce, via high-volume lift, up to five potential Sparky heavy oil wells. The potential is a gross incremental recovery of 800,000 barrels of oil. Georox's contribution will be used a part of a $440,000 initial work program, committed to by the joint venture partners which includes the re-entering of two wells in phase 1 of the program.
In August the well C11-18-50-2w4 was re-entered, re-completed and put on high volume lift. As of the end of October the well was pumped off as planned and tested at 20 bopd with a 4% oil cut. A second well at 13-18-50-2W4 was successfully reviewed for re-entry, re-completion and high volume lift to continue the program. The C11-18 well is temporarily shut-in until the rest of the development takes place to reduce operating costs. As of October 22nd, 2010 Georox has participated in the purchase of a well at 6-18-50-2W4 from an adjacent competitor that will be equipped for high volume lift and put on production later in 2011. The total cost was $116,150 and Georox's share was $29,037.
The operator is proceeding with the installation of electricity at 11c-18 and 6c-18 wellsites to eliminate propane costs associated with production. In the fourth quarter of 2011 and first quarter of 2012 the A13-18 will be re-entered and worked over, plus a Water disposal well will be developed at 12D-18-50-2 W4 and a pipeline from 11c-18 to the 12d-18 disposal well will be constructed. It is planned to bring on all three wells together and flow line all three wells to the disposal well. This work will eliminate all the costs associated with hauling and disposing of the produced water in this high volume lift operation project.
North Llyodminster (Lashburn ) Property
On July 7, 2010 the Company purchased 240 acres in the Lloydminster area of Alberta for $200,000. Georox has also entered into a letter of intent with a company in Alberta which provides for a joint venture to develop the lands. As of October 31st the Joint Venture partner has paid $200,000 toward the drilling and completion of an initial well on the lands. Georox has now assigned a 50-per-cent interest in the lands to its joint venture partner . The overall plan is to verify the Waseca channel sand presence by acquiring additional seismic in the area followed by drilling one to two vertical wells.
The existing Seismic was reviewed and the first vertical well was identified at 2C-4-51-01W4. The well was drilled in December 2010 and it was verified that the Waseca channel did not run through 3-7 of Section 4-51-1W4. This well currently stands as a future water disposal well. To further verify the presence of the Waseca Channel it is planned to acquire additional seismic before identifying a second channel well location that may be present on the east side of LSD 2-4-51-1W4. Seismic acquisition is planned in the fourth quarter of 2011. If the seismic interpretation is encouraging a second well will be drilled in the first quarter of 2012.
This brings Georox's total production to approximately 90 boepd.
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