Athabasca Oil Sands Corp. Provides Light Oil Operations Update on its Kaybob Property in the Deep Basin

Tuesday, Feb 07, 2012

CALGARY, Feb. 6, 2012 /CNW/ - Athabasca Oil Sands Corp. (TSX:  ATH) is pleased to provide a light oil operations update for its Kaybob property located in the Deep Basin area of northwestern Alberta.

The company recently drilled and completed its first Montney horizontal well in the Kaybob East area, located at 13-22-64-18W5.  The 1,220 metre lateral was fracture stimulated with 14 stages of energized oil treatments and was flow tested during 78 hours. During the final 24 hours of the test and after having recovered all the load fluids, the well flowed at an average rate of 2,560 barrels of oil equivalent per day (boe/d), (2,265 barrels per day (bbl/d) of 41 degree API oil with 1.8 million cubic feet per day (mmcf/d) gas), at a stabilized flowing pressure of 450 pounds per square inch gauge (psig). The well is currently shut in until it can be connected to infrastructure. The company holds a significant land position offsetting this well and will continue the delineation of the Kaybob East acreage throughout first quarter of 2012.

In late fourth quarter of 2011, Athabasca also drilled and completed its second Kaybob Nordegg horizontal well at 04-11-63-20W5, offsetting its first successful Nordegg well at 13-14-63-20W5.  After completing the 16 stages of slickwater fractures, the 04-11 well flow tested at a final rate (after four days of clean up) of 420 boe/d, (335 bbl/d of 41 degree API oil and 500 thousand cubic feet per day (mcf/d) gas), at a flowing pressure of 910 psig. Based on the success of this second Nordegg test, the Company will focus its Nordegg delineation on the Kaybob area with further horizontal drilling, core analysis and incorporation of the Company's recently acquired 3D seismic dataset.

The company has drilled two more Montney horizontal wells and one Duvernay horizontal well in the Kaybob area and expects completion and testing to be performed over the next few weeks.

Development of the Kaybob area will benefit from Athabasca's decision to build its 100% owned infrastructure in 2012.  The construction of the 63-kilometre, 12 inch gas pipeline from Kaybob to the Simonette gas plant is on schedule and is expected to be completed in the first quarter of 2012.  In the second quarter of 2012, the Company plans to commence construction of one 10,000 barrels per day (bbls/d) oil battery and one 24 million cubic feet per day (mmcf/d) compression station. The company intends to subsequently expand these facilities to
ultimately handle all of Athabasca's production volumes from the greater Kaybob area. The company anticipates that the facilities and pipeline will be fully operational during third quarter of 2012. Athabasca currently has 1,250 boe/d tied into third party facilities on an interruptible basis and substantial production capacity behind pipe waiting on the completion of its own facilities.

"The recent well results are excellent and I am very proud of our light oil
team," says Sveinung Svarte, president and CEO. "These wells have high liquids ratios confirming our successful strategy of acquiring acreage located within the oil and condensate window of the basin. Our infrastructure construction is advancing as scheduled and we are confident that we will be able to meet our 2012 exit rate target of between 8,000 and 10,000 boe/d." 

Athabasca is also continuing exploration and delineation drilling in the
Simonette, Placid, Waskahigan and Grande Prairie areas and is currently
operating five drilling rigs. Since entering the light oil business, Athabasca has drilled and completed 16 horizontal wells. Three of these wells are currently being tested. A full operational update from both the light oil operations and from the oil sands activities will be provided in connection with the release of our year-end financial results in March.

SOURCE Athabasca Oil Sands Corp

To access over 2,500 of the latest oil projects from across the world visit Projects OGP for free trial today