Lexaria Corp. (OTC: LXRP) reports that work will begin soon for a new oil well to be drilled at the Belmont Lake Field, Miss.
This is the first all-new well at Belmont Lake in three years. The new 12-7 well is classified as a development well within the proven field, and is located immediately to the south-east of the original discovery well, the 12-1. The 12-1 well originally went into production in 2006 at about 102 barrels per day (bbl/d) of oil. It was recompleted in May 2012, when it produced an average of 124 bbl/d of oil during the next 30 days of production.
The new 12-7 well will be located in an east-central quadrant of the expected reservoir that has to date been untapped by oil production and the company expects success in this location. The 12-7 well is located the furthest to the east of any of the existing or currently planned wells in the field, so has the potential to test and drain large new areas of the Belmont Lake Field.
Additionally, Lexaria entered into business finance agreements that have pre-funded 100% of Lexaria's share of expected drilling, completion, and infrastructure costs associated with this well. Because the new well is funded, the company's other cash needs have been reduced. On Nov. 1, Lexaria closed $30,000 on the first tranche of its previously announced financing. Lexaria will be issuing 500,000 units priced at US $0.06 and 500,000 warrants exercisable to buy one additional common share each at $0.10 expiring Nov. 1, 2015. Recompletion work meanwhile continues on the 12-4 well which is slightly behind schedule due to mechanical complications, but is now expected to be completed in the first half of November.
Lexaria retains a 50% working interest in the 12-4 well and a 13.3% working interest in the 12-7 well.
Lexaria Corp. is an independent energy company engaged in the exploration, development, and acquisition of oil and gas properties in the U.S. and Canada. The company is based in Vancouver, B.C.