Winchester Energy sets up for gas sales on continued Mustang production success
Operator reports from Winchester’s Permian Basin oil and gas wells have shown a 357% jump in daily production compared to last quarter.
US-focused Winchester Energy (ASX: WEL) is preparing its White Hat 20#3 oil and gas well on the Mustang prospect in Texas for gas sales after reporting “outstanding” continued production rates.
The onshore oil producer today announced the recently-completed Permian Basin well has reported an initial gross production rate over 30 days (IP30) of 259 barrels of oil per day.
In addition, the well has recorded gas flowing at a rate of 100,000-140,000 cubic feet per day, equating to a further 17-23bpd of oil equivalent.
Winchester managing director Neville Henry said this IP30 rate was an “excellent result as it demonstrates the quality of the Strawn Fry Sand Member as an oil and gas reservoir”.
“Production rates remain high, which augurs well for the eventual determination of the ultimate cumulative oil and gas recoveries from Mustang wells,” he added.
The company said it is now preparing the White Hat 20#3 for gas sales. This follows oil sales from the well, which commenced in late May.
Boost in daily output
According to Winchester, operator reports from all wells in which Winchester holds an interest (including White Hat 20#3) indicated that over the last seven days, gross average oil production was 386bopd.
This rate shows a major jump in daily output with 386bopd representing a 357% increase compared to last quarter’s daily average of 108bopd.
Of this 386bopd, Winchester’s working interest production share is 255bopd, which is a 472% step up from its average net production of 54bopd for the March quarter.
Upcoming drilling
Winchester’s production update follows last week’s announced development strategy including the drilling of 34 new wells across the Mustang prospect.
Mr Henry said White Hat 20#3’s production performance gives the company a “high degree pf confidence” as it gets ready to spud the White 20#4 development well on the Mustang prospect next month.
It also validates the company’s strategy to develop the prospect with the aim of generating significant oil production and cashflow, with White Hat 20#3 production expected to contribute positively to Winchester’s June quarter sales revenue.
The news also comes after the company’s announcement earlier in the week of its plans to spud the Lightning prospect next month at its Arledge lease.