Westside Energy provides operational update
Westside Energy Corporation has provided an interim operations update on the Barnett Shale play in North Texas.
Since Westside’s last update in March:
Westside’s initial horizontal well in Hill County, the Primula #1H, reached its targeted vertical depth of 8,450 feet. The vertical portion of the well has been logged to determine the shale thickness and quality, and to calibrate the Company’s 3-D seismic data for use in selecting future drilling locations in the area. The horizontal portion of the well has been kicked off. A second location has been chosen and is being prepared for drilling after completion of the Primula #1H. The new joint exploration agreement in Hill County has increased Westside’s exposure to more quality drilling prospects and teams the Company up with a partner with significant marketing and technical expertise as well as greater access to services and additional rigs.
Westside continues to drill wells in its North Program area. Six wells are currently drilling or waiting on completion to tie-in to sales lines in order to be placed on production before year-end 2006.
Current net production of approximately 3,800 MCFE/D reflects production added from the three wells recently completed in the North Program area, offsetting the normal flush production decline experienced since March from the new wells added at that time. Due to hydraulic fracturing completion techniques, it is important to note that initial rates from wells in the Barnett Shale include flush production from the created fractures. During the early productive life of a well, the production rate will normally decline significantly before settling out at a much lower base decline rate. However, it is expected that future drilling and completion activities will more than offset these near term decline characteristics, and additional production growth from the current rate is anticipated by year end 2006.
The pipeline development in Montague County associated with Westside’s North Program area (16.67% interest), is progressing on schedule and the main north-south trunk line is expected to be completed during the first quarter of 2007. Completion of this infrastructure is expected to result in a significant improvement in gas price netbacks for Westside’s production as well as increased third-party pipeline revenue of which the Company will receive our proportionate share.
