Tamarack Valley Energy Ltd. (“Tamarack” or the “Company”) is pleased to provide an update on its year end results, 2012 fourth quarter Redwater Viking oil drilling program and 2013 Guidance.
Tamarack is pleased to announce, based on field estimates in December, it averaged 2,160 boe/d (46% liquids) in 2012 which exceeded the mid-point of its previously announced 2012 guidance of 2,000-2,200 boe/d (43% - 47% liquids). Tamarack achieved an exit rate of 2,704 boe/d (52% liquids), based on field estimates in mid-December, compared to 2012 exit guidance of 2,600-2,700 boe/d (51-53% liquids).The Company achieved 2012 production guidance despite production delays on two (1.0 net) non-operated Lochend Cardium oil wells which were recently brought on-stream in mid-January.
Q4 2012 Drilling Results
Tamarack achieved a 100% success rate on eight Viking oil wells drilled in the fourth quarter of 2012, on the lands acquired in the Echoex corporate transaction. Seven (6.85 net) were drilled in the Redwater area and one net well was drilled in the Westlock area. Five of the seven wells in Redwater were stimulated with the standard 10 stage, 10 ton gelled water fracture treatment and the other two wells were designed and completed to enable the wells to be converted into water injectors when appropriate, to optimize reservoir performance. The average IP30 oil rate of the five Redwater Viking wells was 66 bbls/d (64 net). Four of these seven wells were brought on production in late October with the other three on production in December 2012. These wells continue to outperform and as of January 15, 2013, the 6.85 net wells were producing a combined 366 bbls/d.
Since completing the Echoex transaction in mid-2012, Tamarack has been focused on reducing costs and increasing Viking oil productivity at Redwater. The average drilling, completion and equipping costs of the most recent five wells was $1.056 million, a 12% reduction relative to the four wells drilled in the spring of 2012 and a 20% reduction relative to pre-2012 costs. To date, Tamarack has drilled nine wells in total, stimulated with the standard 10 stage, 10 ton gelled water fracture treatment, with IP30 oil rates averaging 76 bbls/d. This average exceeds Tamarack’s original acquisition type curve by 27%.
During the fourth quarter, the Company also drilled two (1.0 net) Cardium oil wells in the Garrington area. These wells were drilled in the fall to avoid higher costs associated with winter drilling. Both wells were stimulated with a multi-stage slick water fracture treatment in January and were put on production through permanent facilities on February 2, 2013. Tamarack expects these wells to perform similarly to wells it has previously drilled in this area.
In addition, two (1.0 net) non-operated Cardium oil wells in Lochend that were expected to be brought on production in December 2012, were put on production in mid-January. Both wells averaged over 1,050 boe/d during their initial 8-10 day test periods as press released on October 15, 2012. Both wells will produce at restricted rates in the first quarter of 2013 due to the operator’s capacity restrictions at the Lochend facility. Tamarack and its industry partners will be expanding the oil handling facility with an expected completion date during the second quarter of 2013.
Source: Tamarack Valley Energy Ltd.
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