Burleson Energy (ASX: BUR) is producing higher levels of condensate from its Joann-1 well in Colorado County, Texas, after switching to a new productive zone.
Following depletion of Zone 4 in early May 2012, Zone 3 was brought into production on 16 May, resulting in average production of 415,000 cubic feet of gas and 82 barrels of condensate per day.
This compares with the previous reported flow of 270,000 cubic feet of gas and 35 barrels of condensate per day from Zone 4.
Burleson said that together with the rebound in US natural gas prices, this has allowed average gas sales of US$5 per thousand cubic feet from Joann-1.
It added its 39.4% working interest in Joann-1 and interests in its other 3 production wells allowed to largely meet its ongoing operation and corporate costs.
As a result, Burleson has no need or interntion to raise additional equity capital to develop the Heintschel gas and condensate field.
Heintschel development
The company is planning to month spud the Truchard-2H horizontal well 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.
A successful well 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.
Burleson has a 83.5% working interest in Truchard-2H.
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