Winchester Energy’s oil well a ‘potential game changer’
Oil and gas explorer and producer Winchester Energy (ASX: WEL) has hit 24m of oil and gas in a well in its White Hat Oilfield in Texas, United States.
The Texas-focused company today reported the third leg of its White Hat 38#3ML well in Nolan County was drilled horizontally for 143m and encountered the oil and gas shows in the upper Ellenburger formation. When added to the results of the other two horizontal legs, the well now has combined total oil and gas shows of 130m.
Winchester Energy described this as a “major milestone” as only 6m of interpreted oil pay was encountered when drilling vertically in the well.
According to the company, these drilling results have achieved proof of concept that its lateral drilling method was the most inexpensive and viable technique for significantly enhancing oil production from the Ellenburger formation.
“The successful drilling of three horizontal laterals at 38#3ML provides the company with a ten-fold exposure to oil and gas bearing zones within the Ellenburger formation when compared to a standard vertical well and, as such, is a potential game changer for the company,” Winchester Energy managing director Neville Henry said.
Location map of the White Hat 38#3ML well in Nolan County, Texas, USA.
Plans to drill a fourth horizontal leg have now been scrapped and the company will instead proceed straight to preparing the well for an extended production testing program over the next three weeks.
“Enhanced production test results from the horizontal legs will provide further proof of the value of the short radius horizontal drilling technology exclusive to the company and its partner in the well, USR Drilling,” Henry said.
White Hat 38#3ML is the first well Winchester Energy has operated. The company has a 60% working interest in the well but is paying 70% of the costs under an agreement with former operator, Carl E Gungoll Exploration, which is being free-carried for a 10% interest in the well. The remaining 30% working interest is held by US-based drilling company USR Drilling.
The White Hat Oilfield lies in the eastern shelf of the Permian Basin, the largest oil producing basin in the US. Winchester Energy holds interest in 78 square kilometres in the region.
Winchester Energy shares were up 9% on the news by the close of trade on Thursday.