G2 Energy Corp (CSE:GTOO, OTC:GTGEF) said it has implemented a Production Enhancement Program (PEP) on its core production asset, the Masten Unit, designed to increase the production of oil and gas.
The company noted that the Masten Unit, located in the Permian Basin in Texas within the billion-barrel Levelland Field, has 18 active producers, six water injectors, and nine shut-in wells. It is now the operator and owns a 100% working interest in the wells and facilities in the Unit.
Over the next three months, G2 said it will be focused on implementing its PEP, which is also aimed at reducing the operating costs to increase the value proposition of the unit.
Under a five-point plan aimed at enhancing the value of the Unit, G2 said after taking ownership of the Masen Unit in July, it appointed Oilwell Operators Inc (OOI) - a highly- respected contract operator currently operating over 600 wells in the Permian basin - to head up the field team.
Upon deploying a team to the Unit, OOI reported that wells were not being operated optimally, with the opportunity to increase production at very little capital cost. One previous operator had shut a well pending the replacement of the flowline at an estimated cost of US$22,000. OOI recommended that the flowline could be brought back into service at a cost of US$1,800 and increase the Unit production by an estimated 16%.
Results flowing through
G2 said after only three weeks, it and OOI have completed basic field maintenance and returned eight wells to production while generating a workover plan for three wells, including well A-13, the Unit’s best producer with expected production of more than 20 barrels of oil per day (bopd).
The Masten Unit is currently producing an estimated 38 bopd and 160,000 cubic feet of gas per day for a total of 65 barrels of oil equivalent per day. Based on 2022 records, G2 said the estimated production from the three wells to be bought on-stream immediately is 34 bopd or an 89% increase from the Unit’s current oil production.
“We are very pleased with the new teams’ rapid progress at G2 and our analysis shows that we can continue to increase production while decreasing operating costs in the near term,” G2 CEO Slawek Smulewicz said.
“The momentum is building, and we will keep the market updated on the results of our Production Enhancement Program.”
Contact the author at stephen.gunnion@proactiveinvestors.com