CALGARY -- Contact Exploration Inc. (Toronto Venture: CEX) is pleased to announce that the Contact operated horizontal Montney well has been successfully drilled and completed with a 15 stage water-based foam frac. Following a 96 hour frac flow back, the well was still cleaning up, with average gross production rates over the final 24 hours of production testing being 1,150 bbl/d condensate and 8,290 mscf/d gas, being 2,532 boe/d combined (431 bbl/d and 3,109 mscf/d, or 950 boe/d combined, net to Contact and before payout) against a wellhead pressure of 1,100psi. In addition to well head condensate, the gas analysis from the 13-17 Well suggests that an additional 25-35 bbl/mmscf of natural gas liquids are recoverable through typical refrigeration processing, and up to 70 bbl/mmscf if deep cut processing is available. The well is currently being equipped with tubing following which additional clean up of frac water is expected over the next several days. The 13-17 Well was drilled and completed within the expected timelines and on budget.
Contact holds a 37.5% interest (25% after payout) in the 13-17 Well, and holds a 25% working interest in a 16 section contiguous land block offsetting the 13-17 Well, with Contact being operator for the entire block. The successful drilling and completion of the 13-17 Well is a milestone for Contact, establishing what is expected to be a significant new core area for the Company at Kakwa. Surveying and applications have commenced for both tie-in operations as well as for the drilling of a follow-up well. The Company currently anticipates the 13-17 Well to be tied-in by September 2012.
Steve Harding, President and CEO commented, "Contact is very pleased with the successful execution and test results from the 13-17 Well. This productivity test substantially exceeds our expectations for liquids yield and confirms our technical work that had suggested our acreage was in the heart of the liquids-rich Montney trend. This result provides a multi-fold boost to our production capability, on a property that we expect will be capable of producing exceptional volumes with further development. We will continue to be focused on our inventory of liquids-weighted projects, characterized by strong economics."
The Company advises that although these initial rates are very encouraging, production test results are not necessarily indicative of long-term performance or of ultimate recovery from the well