CALGARY, June 8, 2015 /CNW/ - Yangarra Resources Ltd. ("Yangarra" or the "Company") (TSX:YGR) provides an operations update on cemented liner and drilling operations.
Yangarra drilled two Cardium wells (1 mile laterals) in 2015 from the same surface pad using cemented liner and sliding sleeves, the first as an 18 stage well and followed up with a 30 stage well. Initial production for the first 30 days ("IP 30") was 158 boe/d and 190 boe/d (both 91% oil), respectively, which is approximately a 25% and 50% improvement over 18 stage ball drop systems in the immediate area.
The Company's half cycle rates of return ("IRR") on type wells in 41-07W5M area of Willesden Green are now greater than 55% with payouts of less than 1.5 years (based on current strip commodity pricing), due to the lower service costs and incremental production from the cemented liners. The 41-07W5M area of Willesden Green have the lowest half cycle IRRs in Yangarra's portfolio of greater than 350 future drilling locations; however, the access to infrastructure in the area allows the wells to generate competitive full cycle rates of return.
With the cemented liner technology, Yangarra is now comfortable drilling extended reach wells and recently drilled and cased its first 1.5 mile (4,320 m measured depth) Cardium earning well. The 1.5 mile well was drilled and cased in 12.9 days (spud to rig release) at a cost of $1.4 million as a result of the knowledge gained from the first two cemented liner wells, lower service costs, improved drilling mud motors, and better drill bit selection. The Company plans to complete (45 stages) and tie in the well early in the 3rd quarter.
As expected, the TCPL rotating pipeline shut-ins have continued throughout the second quarter and the Company will provide an update on the effect of the outages on production after June 30th.
Forward looking information
Certain information regarding Yangarra set forth in this news release, including management's assessment of future plans, operations and operational results may constitute forward-looking statements under applicable securities law and necessarily involve risks associated with oil and gas exploration, production, marketing and transportation such as loss of market, volatility of prices, currency fluctuations, imprecision of reserves estimates, environmental risks, competition from other producers and ability to access sufficient capital from internal and external sources. As a consequence, actual results may differ materially from those anticipated in the forward-looking statements.
All reference to $ (funds) are in Canadian dollars.
SOURCE Yangarra Resources Ltd.
For further information: Jim Evaskevich, President and CEO at (403) 262-9558