Victory Energy Corporation (OTCQB: VYEY), through its partnership with Aurora Energy Partners, announced that the Company has successfully completed the first of nine planned development wells at its recently announced 3D seismic-supported Pinetop prospect, located in Lea County, New Mexico.
The objective zone was drill stem tested with initial gross flow rates of over 400 barrels of oil per day and unmetered flow of 300 Mcf of natural gas per day. The well is now flowing oil to tanks at a rate of approximately 7,680 barrels of oil and 16,890 MCF of natural gas per month. Gas is currently being vented until a pipeline to sales connection is made.
The Company expects the first well to be on production for at least three months before a decision is made to drill up to eight additional gross development wells on the held acreage.
Pre-drill gross recoverable reserve potential per well was estimated at 350,000 BOE to 450,000 BOE, with total recoverable reserve potential of 3,150,000 BOE to 4,050,000 BOE (9 wells). Based on these assumptions, total recoverable reserve potential to the Company's 2.344% net revenue interest could be 73,836 BOE to 94,932 BOE. In the coming months, Victory will commission a third party reserve analysis on this property which will contain more specific reserve estimates.
Kenny Hill, Victory Energy's CEO, stated, "During the first six months of 2012, the Company acquired four new prospects totaling 2,196 gross acres with the potential to add over 477,066 barrels of oil equivalent to the Company's future reserves and production. The Pinetop prospect was the first of these acquisitions to go into production. This is a great first step in the development of these resources."