Burleson Energy (ASX: BUR) expects to this month spud the Truchard-2H horizontal well on the Heintschel field in Colorado County, Texas, that targets 7 billion cubic feet of liquids rich gas.
The multi-staged gas-condensate development well with a horizontal section of up to 700 metres within the Wilcox sandstone reservoir also targets 200,000 barrels of condensate.
Integrated Petroleum Consultants’ independent analysis indicated that this production at current commodity prices would deliver total revenue of U$53 million (A$54.3 million) over the expected 10 year term of the well’s life.
While Truchard-2H is expected to cost about US$6.3 million to drill and complete, Burleson said it was not dependent on finding a farmout partner to drill the well as it had enough cash in hand (A$5.7 million) to fund its share of drilling.
It added that as the well will be drilled and completed in several stages, it will be possible to adjust the forward program to ensure that total expenditure remains within budget.
Should the well success, it will pave the way for full development of the Heintschel field.
While this may require 15 or more wells to be drilled, the success of the horizontal well development concept is expected to open up project financing to fund subsequent drilling.
Truchard-2H will be drilled in 3 phases with the near vertical section of about 3500 metres ; a horizontal section of up to 700 metres that will require a rig with a top drive; and a sox stage fracture stimulation of the horizontal section.
Following this, the well be brought on production and generate wet gas and condensate sales. This will be facilitated by the proximity to the well of hydrocarbon sales and distribution infrastructure.
Burleson has a 83.5% working interest in Truchard-2H.
Proactive Investors is a market leader in the investment news space, providing ASX “Small and Mid-cap” company news, research reports, StockTube videos and One2One Investor Forums.