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Whitebark Energy Ltd: DEEP DIVE

Whitebark Energy expects to further increase reserves at Wizard Lake in Canada

Proved and probable reserves at the Albertan province project are 225,000 barrels of oil.
The Rex drill site at Wizard Lake project
OVERVIEW: WBE The Big Picture
The Rex drill site at Wizard Lake project
  • Permanent production is expected at a Wizard Lake well in June quarter 2019, by about April 2019
  • Commercial production is a milestone for the project
  • Western Australia’s lifting of its moratorium on hydraulic fracture stimulation may prove hopeful for Warro project, once fraccing activity resumes in the state from about 2020

What does Whitebark Energy do?

Whitebark Energy Ltd (ASX:WBE) specialises in oil exploration and development in Canada and holds a fraccing asset in Western Australia where a moratorium on hydraulic fracture stimulation was lifted last year.

It is run by David Messina, a senior executive who has more than 23 years experience in the energy and agricultural biotechnology industries.

Messina has led energy and gas sector companies for the past 13 years and has been based in London, Australia and Europe.

The managing director is skilled at raising significant amounts of funds and identifying strategic partnership opportunities.

What does Whitebark Energy own?

The key asset in Canada is the Wizard Lake Oil Pool Project housed in the Point Loma Joint Venture (PLJV).

Whitebark has a 30% stake in the PLJV with TSXV-listed Point Loma Resources Ltd (CVE:PLX).

The Albertan province project takes in the 2018 Rex well discovery and has 1P (proved) reserves of 132,000 barrels, and 2P (proved plus probable) reserves of 225,000 barrels.

Further updates are expected at the project where 2P reserves were increased by 70% last week after a short production test period.

Once a production well at the project is placed on permanent production in about April 2019, further revisions are expected.

WA-based Whitebark is waiting for full regulatory approvals and facility and pipeline completions before it starts permanent production.

The company expects the production milestone will be achieved in June quarter 2019, with commercial oil production to follow.

A dozen more wells have been earmarked for the field to triple the number of well locations.

Further drilling is expected later this year.

Whitebark’s previously stated strategy was to focus on its Duvernay Shale formation acreage in Alberta, Canada.

In Australia, the West Perth company has the Warro Gas Project northeast of Wheatbelt town Badgingarra and east of holiday spot Jurien Bay.

Warro was previously the company’s flagship project when it was known as Transerv Energy Limited (ASX:TSV).

Perth Basin project Warro has 4.4 to 11.6 trillion cubic feet (Tcf) of gas-in-place (GIP).

It is found 110-200 kilometres north of WA’s capital Perth and less than 35 kilometres from Dampier-Bunbury Natural Gas Pipeline and the Dongara-Perth Parmelia Pipeline.

Dampier and Bunbury both feature ports, as does Perth at two harbours run by Fremantle Ports.

Whitebark welcomed the findings of the Independent Scientific Panel Inquiry into Hydraulic Fracture Stimulation in Western Australia 2018’s final report released in November 2018

The panel found the risks associated with gas extraction techniques were minimal and could be managed safely.

While the state government committed to implementing all the inquiry’s recommendations, some have tipped fraccing in WA would not resume until 2020.

Whitebark has previously noted its cost of fraccing in Canada was about 20% of comparable projects in WA and was achieved in a four-week approval time.

The company had $3.9 million cash on December 31, 2018 and expected $1.4 million of cash outflows in March quarter 2019.

Whitebark’s exploration and evaluation spend for March quarter 2019 was a budgeted $1 million.

Inflection points

  • Permanent production at Wizard Lake

  • Commercial production at Wizard Lake

  • WA Government progress on fraccing reform

  • Alberta, Canada portfolio development by Whitebark

  • Significant milestones from Whitebark investment Triangle Energy (Global) Ltd (ASX:TEG) (FRA:WMOA)

Managing director David Messina tips reserve upgrades

“Given the very short test period and the effective date of the reserve report we are very encouraged with the reserve statement and look forward to revising the numbers once the well is on production and we move forward with additional drilling plans this year,” managing director David Messina said.


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