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High North Resources releases drilling program update

Oilfield Technology,

High North Resources Ltd has provided an operational update on its drilling program.

Girouxville-Mclean property

The company's fourth well, 08-21-076-21W5M, located on the northern portion of the Girouxville-Mclean property, has been drilled and stimulated and is derisking five sections of land which Management anticipates will provide between 20 and 24 horizontal drilling locations. The drill location of this fourth well is adjacent to a section of land on which another oil and gas producer has applied to drill four Montney oil horizontal wells. The 08-21 well produced hydrocarbons from the Montney formation during the production test and is currently shut-in for a pressure build-up test as required by government regulations.

Montney formation

The company's fifth well, located at 08-02-076-21W5M, was drilled in the Montney formation and is scheduled to commence completion this week. This well directly offsets a competitor's Montney oil well, which reported a 30-day initial production rate of 360 bpd and cumulatively produced 33,000 bbls of oil during its first six months, indicating a potential payout in one year using a netback of US$ 50 per barrel of oil.

High North Resource’s first two wells, 16-2-76-21W5M and 9-2-76-21W5M, continue to flow oil at approximately 240 bpd at wellhead pressures above 870 psia through restricted, undersized, rental surface facilities. Management believes that the high pressures are indicative of the capability of increased production rates. Installation of permanent facilities is expected in July 2014.

Alberta Energy Regulator

The Alberta Energy Regulator (AER) is permitting production until end of April 2015, subject to flaring volume constraints while the company proceeds toward the installation of facilities in order to conserve and produce NGLs from the associated gas. The company's third well, 9-26-76-21W5M is shut-in temporarily due to weather-related transportation delays of produced fluid. The company is planning to alleviate this situation shortly. Additionally, the company's project development drilling plan for its 20 contiguous sections has been submitted to the AER and is currently under review.

Adapted from press release by Katie Woodward

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