Hawk drilled three oil wells in western Saskatchewan in the fourth quarter of 2014 all of which are now currently on production. At Rush Lake, the corporation drilled one slant well in the fourth quarter of 2014 that encountered oil pay in the Waseca and Sparky/GP formations. This well is directly offsetting an existing Sparky/GP pool and a proposed SAGD thermal development in the Sparky/GP formation. Hawk's well has been on production since the start of December 2014 from the Sparky/GP formation and is currently averaging approximately 55 boe/d.
At Eureka, the corporation drilled its first horizontal well on its developing Basal Mannville play. This well has been on production for approximately three weeks and is currently producing 60 boe/d. Hawk is very encouraged by this initial production rate and is evaluating future drilling plans using horizontal wells to fully develop the corporation's land in this area. The producing horizontal well was drilled on crown acreage and is eligible for a crown royalty holiday of 2.5% on the first 38 000 boe produced. Hawk expects to drill an additional well in the first quarter of 2015 to evaluate the potential on the northern portion of the play.
Lastly, at Yonker, the Corporation drilled a McLaren discovery well that encountered three metres of net pay. This well has been placed on production and is currently producing 65 boe/d. Hawk plans to acquire some additional two dimensional seismic data on this play in the first quarter of 2015 and expects to drill further development wells on this play in the second half of 2015.
First Half 2015 Capital Budget
The corporation has set a first half 2015 budget that will see Hawk drill two vertical wells in western Saskatchewan both of which are expected to be drilled in the first quarter of 2015. Hawk is planning on drilling its second earning well at Forest Bank in the first quarter of 2015 whereby Hawk will pay 100% of the capital costs of the earning well to earn a 65% working interest in one section of land at Forest Bank. The corporation's first earning well at Forest Bank is currently producing 65 boe/d. The corporation also plans to drill one vertical well at Eureka which will earn the corporation a 100% working interest in 480 acres of land. Hawk has chosen to decelerate drilling on current prospects, but is taking advantage of the current low price environment to drill two wells that earn significant additional acreage and add to the inventory of future opportunities. These wells are Hawk's only remaining commitment locations.
Hawk will determine its second half 2015 capital budget during the second quarter of 2015 which will be dependent on the oil price forecast for the second half of 2015. Hawk will remain disciplined and flexible with its second half 2015 capital budget as it monitors oil prices and business conditions.
The corporation has developed an inventory of development drilling at its four core areas of Forest Bank, Rush Lake, Eureka and Yonker, all in western Saskatchewan for the second half of 2015 and into 2016. The corporation has also identified several well recompletion candidates at Forest Bank where the corporation anticipates it can add production with low capital costs and anticipates one recompletion in the first and second quarter of 2015.
All of the corporation's planned capital projects for 2015 are operated and controlled by Hawk. The corporation will control the pace of development of its projects and accelerate or delay capital spending depending on the price of oil and the corporation's cash flow.
Adapted from press release by Joe Green
Read the article online at: https://www.oilfieldtechnology.com/exploration/19122014/hawk-exploration-announced-operational-update-provided-guidance-corporation-422/