19 horizontal wells to be drilled with two rigs/Completion of 6 new Elster wells in June
Denver/Heidelberg. Cub Creek Energy (CCE) will commence drilling of 19 horizontal wells in the core area of the Wattenberg field in Colorado over the next few days. The wells will be drilled from two pads. The first pad (“Vail pad”) will allow for 9 wells. CCE has a working interest of nearly 100% in these wells. 10 wells will be drilled from the second pad (“Markham pad”). Working interest for CCE is expected to average 75% in these wells. CCE and Deutsche Rohstoff have decided to adjust the previously planned drilling strategy and now drill the wells with two drilling rigs nearly simultaneously. Drilling at the Vail Pad is anticpated to begin the week of June 5th. The planned spud date for the Markham pad is predicted for the week of June 27th. Drilling is expected to be ongoing until mid-August, 2016 with completion of the wells expected in September, 2016. Production will begin in September or October of 2016. The total investment of Cub Creek will be amount to approximately USD 45 million.
Both pads are situated in an area the CCE has detailed technical experience in as they reside only a few miles south of the former Tekton Energy Windsor project as well as Elster´s Magpie project. Elster Oil & Gas (EOG), 93% owned by Deutsche Rohstoff, is currently participating in the drilling of six new wells which will be finished over the next few days. Production from these 6 new wells is anticipated to being started sometime in the third quarter of 2016.
Bob Gardner, CEO and President of Cub Creek Energy, commented: “We are excited to get started now after 15 months of intense assembly of drilling projects. Drilling with two rigs secures very favorable terms with service companies and will result in a much higher cash flow as early as in the fourth quarter of 2016 compared to drilling with one rig. Higher oil prices support this decision.”
The drilling program will partly be financed with equity, partly with debt provided from Deutsche Rohstoff. Management of CCE will participate in the equity financing with an overall amount in excess of USD$ 650,000. Deutsche Rohstoff´s share in the company will rise to roughly 79% after the capital increase.
Heidelberg, 6 June 2016
Deutsche Rohstoff identifies, develops and divests attractive resource projects in North America, Australia and Europe. The focus is on the development of oil and gas opportunities within the United States. Metals, such as gold, copper, rare earth elements, tungsten and tin complete our portfolio. For more information please visit www.rohstoff.de.