Nighthawk Energy (AIM: HAWK) announced an update on drilling and production at its 100% controlled and operated project at Jolly Ranch in the Denver-Julesburg Basin, Colo.

Following the success of the John Craig 6-2 well and the positive indications from the open-hole logs of the Williams 4-30 and Knoss 6-21 wells, the company has committed to a fifth well in the 2012 drilling program.

The fifth well, the Whistler 6-22, is located close to, and due south of the Steamboat Hansen 8-10 location, on the northern boundary of Lincoln County and over 35 miles north of the current Jolly Ranch core area. The well will test a similar horst structure to the Steamboat Hansen 8-10 with primary targets of the Cherokee and Marmaton formations.

With the potential for drilling success in this northerly area, Nighthawk has moved to protect its acreage position by successfully bidding to retain over 6,000 gross acres in the immediate vicinity of these wells.

Steamboat Hansen 8-10

Drilling of the Steamboat Hansen 8-10, the fourth well in the drilling program, commenced on 14 October. Drilling has progressed on schedule and is currently past 6,500 feet. Planned target depth for the well is 8,500 feet.

Pike's Peak Williams 4-30

The Williams 4-30 well, the second well in the program, is located on Nighthawk's more southerly acreage, close to the existing older Jolly and Craig wells. The well was drilled to its target depth of around 7,900 feet with the open-hole logs showing good oil indications in the Cherokee and Marmaton formations. Initial completion was in the Cherokee formations, with stimulation of the formation utilizing mild acidization under relatively low pressure that has not stimulated hydrocarbon flows from these zones. With good potential in this well, a thorough review of the available data is being carried out to determine the next steps, and further completion and testing has been temporarily deferred and the rig has moved to the Knoss 6-21 location. The rig will return to the 4-30 location at a future date once the revised stimulation plan is determined.

Knoss 6-21

The Knoss 6-21 well, the third well in the drilling program, was successfully drilled to its target depth of around 8,400 feet and the well has been logged and cased. The completion rig is currently on location and the well is being prepared for initial completion and testing.

John Craig 6-2

Flow-tests on the John Craig 6-2 well commenced and the well flowed under natural pressure for three consecutive days. Following the installation of new pumping equipment and storage facilities the well was brought into permanent production on Oct. 7, 2012.

As this is the first significantly successful well at Jolly Ranch, a prudent approach to pumping has been maintained in order to avoid excess water production and risk of formation damage. The well is being cautiously managed to produce in a general range of 200 and 250 bbl/d of oil, comfortably within the overall pumping capacity of the well, and will be subject to adjustment during this start up phase.

Gross average production of 76 bbl/day in Q3 2012 was boosted by a three-day contribution from initial production from the John Craig 6-2 well. There was also continued gradual improvement in production from the older wells, with September gross production from these wells reaching 73 bbl/d, a 20% increase on August levels. Including the 6-2 contribution gross average production in September was 118 bbl/d, the highest monthly average since mid-2010.

October gross production will see another substantial step-up, with total gross production over the past 11 days averaging approximately 270 bbl/d of oil.