Exploration Western Highlights

?1 A competitive auction of geothermal leases on federal public lands in Nevada sold 105,211.54 acres, on 35 parcels in Churchill County. ENEL Geo­thermal LLC of Reno and Denver-based Standard Steam Trust LLC made the most significant bids. The August 5 sale was the first to offer parcels formally nominated by the public using a process outlined in regulations the BLM published in May 2007.

2 Denver-based Fidelity Exploration & Production Co. has received drilling permits for six vertical Cane Creek (Paradox-Pennsylvanian) tests in an area nine to 13 miles generally west of Moab, Utah. The southwestern Grand County ventures are projected to be drilled to depths from 7,500 to 8,000 ft. The sites are within five miles of Fidelity’s #24-1 Cane Creek discovery, which is producing more than 300 bbl. a day. Approximately 90,000 acres in the Paradox Basin are owned by Fidelity.

3 IHS Inc. reports that Devon Energy Production Co. LP, based in Oklahoma City, submitted a development proposal on its Beaver Creek coalbed-methane (CBM) properties to the Bureau of Land Management office in Lander, Wyo. The proposal specifies up to 228 vertically drilled gas wells. Devon’s proposal says that 208 of the wells would produce CBM and 20 wells would produce conventional gas from approximately 16,515 acres within the Beaver Creek Unit area in townships 33 and 34n, range 96, Fremont County, Wyo., on the southern flank of the Wind River Basin near Riverton. The estimated drilling and completion would occur over five to 10 years with a project life of 20 to 40 years. Devon proposes one well every 40 acres and targets the deeper Madison and Phosphoria formations. The Lander field office will prepare an Environmental Impact Statement to analyze the project’s potential impact, and a 45-day scoping period will be conducted to gather public and interested-party input.

4 Wexpro Co., a subsidiary of Salt Lake City-based Questar Corp., completed a horizontal Baxter producer in the Vermillion Basin about 42 miles southeast of Rock Springs, Wyo., in Canyon Creek Field. Gas flowed at an initial rate of 3.3 million cu. ft. of gas and 984 bbl. of water per day. The #62H Canyon Creek is in Section 36-13n-101w, southern Sweetwater County. Completion was through an 18/64-in. choke in five fracture-stimulated stages between 11,310 and 15,110 ft. in a horizontal lateral in Baxter.?At its surface location, the well is a twin to a 1985 Mesaverde gas producer at 6,538-7,090 ft.

5 Slawson Exploration Co. Inc. completed a horizontal Bakken project in southeastern McKenzie County, N.D., initially flowing 216 bbl. of 36.5-degree oil and 54,000 cu. ft. of gas per day with no water. The #1-4H Piranha in Section 4-146n-104w produces from a horizontal lateral in Middle Bakken extending from 10,843 ft. north-northeastward to 14,145 ft. at a bottomhole location in the same section. Flow was measured through an 18/64-in. choke with a tubing pressure of 140 psi.?The well is about 18 miles southeast of Sidney, Mont. Slawson’s headquarters are in Wichita, Kan.

6 Enid, Okla.-based Continental Resources Inc. has completed a horizontal Bakken producer in the Dimmick Lake Field area on the Nesson Anticline, about 13 miles northeast of Watford City, N.D. Located in Section 17-151n-96w in eastern McKenzie County, #1-17H Dodge initially flowed 989 bbl. of oil equivalent per day from a horizontal lateral in Middle Bakken. Further well details are not yet available. The well was drilled under a joint venture between Continental and Conoco­Phillips.

7 Another Continental Resources horizontal Bakken discovery, about 10 miles south, initially flowed 596 bbl. of oil equivalent daily. Flow was measured on a 10/64-in. choke with a casing pressure of 3,150 psi. The #1-32H Kermit, Section 32-150n-96w, eastern McKenzie County, N.D., is producing from a horizontal Bakken lateral drilled to 20,250 ft. The #1-32H Kermit is about 1.5 miles south of Pershing Field, a Madison/Interlake oil pool. Continental owns a 45% working interest in the well.

8 Also in western North Dakota, Brigham Oil & Gas LP tested its #22-1H Carkuff at an early flowing rate of 1,110 bbl. of oil and 400,000 to 500,000 cu. ft. of gas per day through 71?2-in. casing after stimulation. The #22-1H Carkuff, in Section 22-155n-92w, Mountrail County, is about six miles south-southeast of Ross. Austin-based Brigham has a 67% working interest in the well. A mile east, Brigham recently staked #25-1H Adix as a horizontal test of Devonian Three Forks. Drilling was scheduled to start shortly.

9 According to IHS Inc., Fidelity Exploration & Production Co. completed a horizontal Bakken discovery about 13 miles southwest of Stanley in western Mountrail County, N.D., initially flowing 1,078 bbl. of oil and 297 bbl. of water per day. The #11-21H Fladeland in Section 21-154n-92w is producing from six fractured and perforated intervals between 10,825 and 15,270 ft. in a horizontal Middle Bakken lateral. Flow was measured through a 24/64-in. choke with a casing pressure of 650 psi. Fidelity holds a 32% working interest in #11-21H Fladeland.

10 Radnor, Pa.-based Penn Virginia Corp. reported discoveries in its first two operated horizontal wildcats in North Dakota’s Bakken play. The Dunn County discoveries, drilled approximately 17 miles south of the town of Dunn Center, are #10-1H Dvorak, Section 10-142n-95w, and #22-1H Sickler, about six miles east-southeast in Section 22-142n-94w. Both wells were drilled as single-lateral Middle Bakken projects on 1,280-acre spacing units: #10-1H Dvorak was drilled northward to a bottomhole location, and #22-1H Sickler was drilled northward to a bottomhole location on a unit comprising all of sections 15 and 22. The #10-1H Dvorak flowed 666 bbl. of oil per day; #22-1H Sickler tested at 50 bbl. of oil a day and is awaiting the installation of a pump jack. The company has a 50% working interest in both wells.

11 Bakken news continues to roll in. Marathon Oil?Co., based in Houston, has completed a stepout from western Dunn County’s Murphy Creek Field, about eight miles south of Killdeer, N.D. Initially flowing 319 bbl. of 40.4-degree oil, 179,000 cu. ft. of gas, and 128 bbl. of water daily, #24-32H Ian Houghton in Section 32-144n-95w is producing from a fractured openhole horizontal lateral in Middle Bakken extending from 10,870 ft. northward to a measured total depth of 19,491 ft. Flow was measured through a 9/64-in. choke with a casing pressure of 1,225 psi. About a half-mile east-southeast of Marathon’s well, Anschutz Corp., Denver, has a location staked for a horizontal Bakken project at #31-5H Wittinger in Section 5-143n-95w. No activity has been reported at that site.

12 The Bureau of Land Management sold oil and gas leases on the Roan Plateau near Rifle in western Colorado. Bids for 31 tracts in 54,631 acres in Garfield County averaged $2,084.05 per acre.?Vantage Energy Piceance LLC, a unit of Denver-based Vantage Energy LLC, bought 19 tracts, Denver lease broker Meadow Ridge #3 LLC won nine parcels, Oxy USA Inc. received two tracts, and Denver-based Sellmar Co. won one tract. The Roan Plateau leases are subject to a number of strict stipulations. The original sale offering was comprised of 46 parcels covering 72,997.92 acres. Fifteen tracts covering about 18,366 acres in the Grand Mesa, Uncompahgre and Gunnison national forests were withdrawn at the request of the U.S. Forest Service. Leases on top of the plateau will require a single federal unit and phased, ridge-by-ridge development, in which only one operator conducts operations on behalf of all lessees.