HOUSTON, Nov. 21, 2013 /CNW/ - Gastar Exploration, Inc. ("Gastar") (NYSE MKT: GST) today announced that the Mid-Con 6H well in its Hunton Limestone oil play reached a peak 24-hour gross initial production ("IP") rate of 1,442 barrels of oil equivalent ("BOE") per day and averaged 1,133 BOE per day (86% crude oil) over the last 10 days. The Mid-Con 6H well was completed in early October and reached peak production 45 days after flow-back operations commenced. The well was completed in the Hunton Limestone formation utilizing a 22-stage fracture stimulation over the well's lateral length of 4,200 feet. Gastar has a 50% working interest ("WI") (39% net revenue interest "NRI") in this non-operated horizontal well drilled in an area of mutual interest ("AMI") in Kingfisher County, Oklahoma.
J. Russell Porter, Gastar's President and CEO, commented "Working with the operator of our existing AMI, Husky Ventures, we have continued to refine the drilling and completion operations in the Hunton Limestone horizontal oil play, which we believe is contributing to higher IP rates and improved results. With the Mid-Con 6H results, three of our last five non-operated wells are producing or capable of producing at rates significantly above our internally generated type curve of 608 BOE per day (65% crude oil) and estimated ultimate per well recovery of 436,000 BOE. At an estimated drilling and completion cost of $5.8 million, the Mid-Con 6H well should generate an internal rate of return on such costs in excess of 100% at current NYMEX forward strip pricing."
Gastar's seventh non-operated Hunton well, the Mid-Con 7H (GST 48% WI, 38% NRI), has been completed and is in early stages of flow-back with extremely positive early indications. Gastar's first operated well in our Hunton Limestone oil play, the Burton 16-1H (GST 79% WI, 66% NRI), is currently being completed, with flow-back operations expected to commence by early December. Drilling operations began on Gastar's second operated well, the Townsend 6-1H (GST 100% WI, 80% NRI) on November 8, 2013, with flow back operations expected to commence by year-end.
About Gastar Exploration
Gastar Exploration, Inc. is an independent energy company engaged in the exploration, development and production of oil, natural gas, condensate and natural gas liquids in the United States. Gastar's principal business activities include the identification, acquisition, and subsequent exploration and development of oil and natural gas properties with an emphasis on unconventional reserves such as shale resource plays. Gastar is currently pursuing the development of liquids-rich natural gas in the Marcellus Shale in West Virginia and is also in the early stages of exploring and developing the Hunton Limestone horizontal oil play in Oklahoma. For more information, visit Gastar's website at www.gastar.com.
Safe Harbor Statement and Disclaimer
This news release includes "forward looking statements" within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. Forward looking statements give our current expectations, opinion, belief or forecasts of future events and performance. A statement identified by the use of forward looking words including "may," "expects," "projects," "anticipates," "plans," "believes," "estimate," "will," "should," and certain of the other foregoing statements may be deemed forward-looking statements. Although Gastar believes that the expectations reflected in such forward-looking statements are reasonable, these statements involve risks and uncertainties that may cause actual future activities and results to be materially different from those suggested or described in this news release. These include risks inherent in natural gas and oil drilling and production activities, including risks of fire, explosion, blowouts, pipe failure, casing collapse, unusual or unexpected formation pressures, environmental hazards, and other operating and production risks, which may temporarily or permanently reduce production or cause initial production or test results to not be indicative of future well performance or delay the timing of sales or completion of drilling operations; delays in receipt of drilling permits; risks with respect to natural gas and oil prices, a material decline in which could cause Gastar to delay or suspend planned drilling operations or reduce production levels; risks relating to the availability of capital to fund drilling operations that can be adversely affected by adverse drilling results, production declines and declines in natural gas and oil prices; risks relating to unexpected adverse developments in the status of properties; borrowing base redeterminations by our banks; risks relating to the absence or delay in receipt of government approvals or fourth party consents; risks relating to the WEHLU Acquisition; risks relating to our purchase of assets from Chesapeake Energy, including the risk of being exposed to unknown contingencies or liabilities that could cause Gastar to not realize the expected benefits of the transaction and the risk that we may be required to fund the transaction by borrowing under our revolving credit facility; risks relating to the divestiture of our East Texas assets, including the risk that the transaction will not be completed or will be completed under different terms; and other risks described in Gastar's Annual Report on Form 10-K and other filings with the U.S. Securities and Exchange Commission ("SEC"), available at the SEC's website at www.sec.gov. Our actual sales production rates can vary considerably from tested initial production rates depending upon completion and production techniques and our primary areas of operations are subject to natural steep decline rates. By issuing forward looking statements based on current expectations, opinions, views or beliefs, Gastar has no obligation and, except as required by law, is not undertaking any obligation, to update or revise these statements or provide any other information relating to such statements.
SOURCE: Gastar Exploration, Inc.
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