Winchester Energy recovers oil in initial production testing at Mustang well

Winchester Energy ASX WEL Strawn Sand White Hat Mustang Project oil
Winchester Energy has recovered 45 barrels of oil from initial production testing at its White Hat 20#3 well in Texas, more than double the initial rate of a nearby producer.

Winchester Energy (ASX: WEL) has begun production testing the Strawn sand at an exploration well targeting the Mustang oil prospect in Texas’ Permian Basin, ahead of fracture stimulation operations expected to draw even more oil from the well.

The US-focused oil explorer commenced completion and testing activities of the White Hat 20#3 well last week, following its recent successful drilling campaign in which oil and gas shows were observed in the primary target Strawn sand, as well as the Wolfcamp D shale, Strawn lime, Caddo and Ellenburger formations.

In an update today, Winchester said initial preparation of the well began with an acid flush of the Strawn oil reservoir and the start of swabbing.

According to the company, drilling fluids and spent acid with an oil cut up to 47% oil has been recovered, with 45 barrels of oil recovered in total.

Winchester managing director Neville Henry said the company is “encouraged” by this initial result as it appears greater than the initial completion rate of 20 barrels of oil per day achieved at the nearby producing White Hat 20#2 well.

White Hat 20#2, located 510m from White Hat 20#3, hit 20 feet of oil pay during drilling then produced oil at a rate of 200bopd following fracking operations some two years ago.

White Hat 20#3 has already surpassed this drilling result, with wireline log interpretation of the primary Strawn sand target confirming a net oil pay of 28ft from a gross 52ft oil-bearing interval from a depth of 5918ft.

The swabbing production test will be followed by fracture stimulation or ‘fracking’ operations, similar to that performed in White Hat 20#2.

“Fracking of the Strawn sand zone is expected to commence in approximately 10 days,” Mr Henry said.

Upcoming plans

While considered an exploration well, White Hat 20#3 is a 3D seismically defined ‘step out’ well of the initial ‘discovery’ well White Hat 20#2, which showed the first evidence of the oil-bearing potential of the Mustang stratigraphic play.

White Hat 20#3 is the first in three-well exploration drilling campaign planned over the coming months across Winchester’s White Hat Ranch acreage.

Combined with two remaining wells targeting the Spitfire and El Dorado prospects, the company is aiming to define a best to high estimate prospective resource of 7.8-17.5 million barrels of recoverable oil.

Winchester also said it has all the completion and production facilities lined up to ensure White Hat 20#3 can be production tested and brought onto production “rapidly”.

The company has a 75% working interest in White Hat 20#3, with private Texas-based company Carl E Gungoll Exploration holding the remaining 25% stake.

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