CALGARY, Dec. 21 /CNW/ - Cirrus Energy Corporation (TSXV: CYR) announces the following operational update regarding ongoing drilling activities in our wholly owned subsidiary, Cirrus Energy Nederland B.V. ("Cirrus") in The Netherlands.
L8-D Field Drilling Operations; L11b-A07 well (Cirrus 25.5%, operator)
The Noble Lynda Bossler drilling rig reached a total measured depth of 5,840 meters on November 28, 2009. Operational difficulties were subsequently encountered during cementing operations of the liner over the reservoir section. While attempting to disconnect the liner running tool from the liner hanger, the running string parted leaving a fish in the hole made up of drill pipe and the liner running tool. After numerous unsuccessful attempts to retrieve the fish, the L8-D Unit partners have agreed to sidetrack the well and drill a new lower hole section to the reservoir. The estimated duration for this operation is approximately 70 days which includes for the expected testing of the new wellbore and running a completion.
Cirrus' President, David Taylor, comments: "These operational problems are particularly unfortunate as the well had achieved the planned total depth, the strip log and gas detector provided positive indication of the expected gas-bearing reservoir section and the liner had been run over the reservoir. There will now be a delay to the expected production start of the A07 well and an increase in the overall total budget for this well.
On a positive note, however, the budget increase has been partially mitigated by a substantial reduction in the day rate for the Noble Lynda Bossler rig which, effective Dec 15, 2009, has been reduced from US$220,000 per day to US$89,500 per day. The original well AFE of (euro)32.0MM gross has been increased to (euro)39.4MM gross and hence Cirrus' net share of the budget increase is estimated to be (euro)1.9MM (C$3.0MM). Cirrus has also secured options to use the Noble Lynda Bossler for drilling in 2010 for up to 240 days at these new lower rig rates."
Cirrus Energy Corporation is an international oil and gas company headquartered in Calgary and has approximately 93.1 million fully diluted common shares outstanding.
This press release may include forward-looking statements including opinions, assumptions, estimates and expectations of future production, cash flow and earnings. When used in this document, the words "anticipate", "believe", "estimate", "expect", "intent", "may", "project", "plan", "should" and similar expressions are intended to be among the statements that identify forward-looking statements. Forward-looking statements are subject to a wide range of risks and uncertainties, and although the Company believes that the expectations represented by such forward-looking statements are reasonable there can be no assurance that such expectations will be realized. Any number of important factors could cause actual results to differ materially from those in the forward-looking statements including, but not limited to, the volatility of oil and gas prices, the ability to implement corporate strategies, the state of domestic capital markets, the ability to obtain financing, changes in oil and gas acquisition and drilling programs, operating risks, production rates, reserve estimates, changes in general economic conditions and other factors more fully described from time to time in the reports and filings made by Cirrus with securities regulatory authorities.
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SOURCE CIRRUS ENERGY CORPORATION
For further information: For further information: David Taylor, President and Chief Executive Officer, Glenn Gradeen, Executive Vice President and Chief Operating Officer, Cirrus Energy Corporation, Suite 208, 5 Richard Way, S.W.Calgary, Alberta, T3E 7M8, Canada, Website : www.cirrusenergy.ca, Telephone: (403) 216-5030, Facsimile: (403) 265-9530