Onshore oil producer Winchester Energy (ASX: WEL) has achieved record oil production figures from producing properties within its 17,266-acre lease position in the East Permian Basin of Texas.
Following recent drilling success at the Mustang oilfield and the new Lightning oil discovery, the company recorded an increase in production to approximately 506 gross barrels of oil per day (bopd).
Winchester’s working interest from this volume is 381bopd and results in a significant increase in revenue for the company.
Since April, gross production has increased from around 100bopd and Winchester’s working interest barrels have improved from 50bopd, reflecting a 700% increase.
Winchester managing director Neville Henry said the company is now in a “much stronger position than ever” with its cashflow and production.
“Combined with the depth of our low-risk drilling inventory at Mustang and Lightning and the large number of exploration opportunities providing significant blue-sky potential, this is very good news,” he said.
“I look forward to seeing additional production growth in the months to come.”
The discovery of oil at the Lightning prospect this year has been a positive development for Winchester given the thickness and laterally-pervasive nature of the oil-bearing unit.
Seismic work has identified a series of large shelf slope Cisco Sand ‘wedges’ of thick laminated and channelised slope fan complexes at the target covering over 5,000 acres confirmed by drilling, with well analysis indicating it may extend over the company’s neighbouring Thomas lease.
“Lightning Prospect is in its infancy and requires us to approach completion in the reservoir in a methodical and structured manner in order to best understand reservoir characteristics and optimise production rates,” Mr Henry said.
This month, the company plans to spud the McLeod 17#1 well following on from the Lightning prospect’s successful Arledge 16#2 discovery well.
McLeod 17#1 will target the same Cisco sands as at Arledge and represents an opportunity for Winchester to further boost its production.
The fourth consecutive well to be drilled at the Mustang oilfield has reached total depth and was logged last week.
White Hat 20#4 will be completed as an oil producer with production casing run and a testing and fracture stimulation program conducted when a crew becomes available.
The Mustang field has reached production to date of 85,000 gross barrels and Winchester is continuing to develop it with highly commercial low-cost and low-risk wells designed to significantly increase oil production.
The company said three new well locations within the field are in the process of being permitted.