CANADA ENERGY PARTNERS REPORTS ON TEST EXTENSION OF PEACE RIVER MONTNEY WELL AND PROVIDES MONIAS UPDATE
December 17, 2010
VANCOUVER, BRITISH COLUMBIA - Canada Energy Partners Inc. ("Canada Energy" or the "Company") (TSX VENTURE: CE) is pleased to provide results from extended testing of the Portage c-20-E well subsequent to those results provided in the Company’s December 13th announcement.
The initial re-test of the Portage c-20-E as reported on the 13th was prematurely terminated due to safety concerns due to potential metal fatigue associated with the significant pressure drop at surface and extreme cooling. Subsequently, the necessary heating equipment was installed to allow testing of the well to continue with regard to safety. The well was re-opened for a two day flow period, during which the peak flow-rate was 9.7 million cubic feet per day (see attached flare photo). A stabilized flow rate of 4.4 million cubic feet per day was experienced at the end of the test, with the well performing at an average rate of 6.6 million cubic feet per day for the final two day period. The c-20-E re-test results of 1100 mcf/d per frac treatment compares very favorably with the Talisman completions on their Farrell Project 5 miles to the north where the fracture treatments from the Upper Montney have averaged 540 mcf/d per fracture treatment.
The c-20-E was drilled in the first quarter of 2010 and initially completed in June 2010 (see Company announcement dated July 6, 2010), testing between 1.7 and 2.7 million cubic feet per day during a ten day test. The lateral length was 1000 meters and was fraced with four stages. This is approximately half the length and half the sand placement of a typical development well in the area.
The Company expects this retest to have a favourable impact on the year end 2010 reserve report which will be completed and disclosed as soon as practical.
Due to the difference in results at c-20-E over time, the Company will retest the 3-12 well in the future as it is anticipated the reservoir will exhibit the same improved characteristics.
The Company believes that the initial drilling program conducted by the Operator has confirmed a large in-place gas resource at Peace River and has significantly de-risked the play. The Company owns an interest in the Peace River CBM gas plant which can be adapted to Montney production with minor modifications. It is also notable that there remain three untested formations (Doig Siltstone, Doig Phosphate, and Lower Montney) that have been deemed commercial by adjacent operators in the area with large confirmed in-place gas resources. Canbriam has recently announced a Lower Montney test at Farrell of 1 million cubic feet per day per frac stage, with 8 frac stages conducted. Talisman’s first Lower Montney horizontal at Farrell is performing commensurately with its Upper Montney wells and completed their first horizontal well in the Doig Phosphate in October 2010.
The Company owns 5 net sections at Monias, three of which are owned 100% and are adjacent to the Shell acreage (see attached map). Shell drilled a very successful vertical Montney test 1.5 miles from the Company’s lease line in Q4 2009. Shell followed that up with 5 horizontal wells which were directionally drilled in close proximity of the Company’s lease line. The Company has confirmed that Shell has initiated completion operations on one or more of their wells offsetting the Company’s
Monias acreage. This data must be released within thirty days of completion. The log on one of the five Shell horizontals, which was drilled to within 150 meters of the Company’s lease line, has been released and shows an extraordinary pay section of 3-9% porosity throughout the 2000 meter horizontal wellbore.
Canada Energy is an active oil and gas exploration and development company. The Company possesses a large concentrated land position in a high-impact, multi-zone, natural gas-bearing area in northeast British Columbia.
On behalf of the Board of Directors of
Canada Energy Partners Inc.
CANADA ENERGY PARTNERS INC.
1500 – 885 West Georgia St.
Vancouver, BC V6C 3E8
Main Phone: (604) 909-1154 / Facsimile: (604) 488-0319
Attention: John Proust, Chairman
Direct Phone: (604) 696-9020
Attention: Ben Jones, President and CEO
Direct Phone: (225) 388-9900
The TSX Venture Exchange has neither approved or disapproved of the contents of this press release. Neither the TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this press release.
Forward Looking Statements: This news release contains forward looking statements relating to expected or anticipated flow rates, timing for drilling and completion operations, future events and operations, number of wells to be drilled, timing of projects and anticipated results that are forward looking in nature and, as a result, are subject to certain risks and uncertainties, such as general economic, market and business conditions, the regulatory process and actions, technical issues, new legislation, competitive and general economic factors and conditions, the uncertainties resulting from potential delays or changes in plans, the occurrence of unexpected events, and the company’s capability to execute and implement future plans. Actual results achieved may vary from the information provided herein as a result of numerous known and unknown risks and uncertainties and other factors. There is no representation by the company that actual results achieved during the forecast period will be the same in whole or in part as that forecast.