Lynden Energy Corp. reports that production net to Lynden, before royalties, from its Wolfberry Project in the Permian Basin, West Texas has averaged 900 barrels of oil equivalent ('boe') over the past 10 days, including two days in excess of 1,000 boe/day. Production net to Lynden, after royalties, averaged 700 boe/day. The production is from 37 gross (15.77 net) vertical Wolfberry wells and is approximately 65% oil and 35% gas and associated liquids.
An important contributor to this production growth is a recently drilled well in the Wind Farms Prospect Area which has performed considerably above expectations with the 30-day initial gross production averaging 176 barrels of oil and 565 mcf of gas per day, equivalent to 270 boe/day, and averaging 250 barrels of oil and 999 mcf of gas per day, or 416 boe/day over the last 10 of the 30 days. Lynden has a 43.75% working interest in this well before royalties.
The company's current plans call for the spudding of 37 gross (15.60 net) wells across the Wolfberry Project in calendar 2012, an increase over the previously announced 31 gross (12.97 net) wells. Twenty of the 37 wells remain to be spud. The company anticipates significant increases in daily production volumes as development of the Wolfberry Project continues and is targeting a December 31, 2012 net production exit rate, after royalties, in excess of 1,000 boe/day.
The company anticipates financing the majority of its Wolfberry Project capital expenditures through current working capital, operating revenues, upward borrowing base revisions on the $50 million reducing revolving line of credit with Texas Capital Bank, and potential asset sales.
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