Courtesy of Benzinga.
Six New Oil Fields Discovered
Approximately 25 Direct Offset Locations
New Seismic Shoots to Cover Sixty-Six Square Miles
Credo Petroleum Corporation (Nasdaq: CRED) today updated its Kansas and Nebraska drilling project.
Michael D. Davis, Chief Executive Officer, stated, “We have recently discovered six new oil fields in Kansas and Nebraska which we expect to have a meaningful positive impact on Credo’s reserves, production and cash flow. Our initial analysis of the new fields indicates potential for about 25 direct offset locations. In addition, successful offset drilling should generate step-out locations. Credo’s working interest ownership in the new fields ranges from 49% to 75%. For proprietary business reasons, we are not releasing specific information, such as locations, tests and production rates.
Davis continued, “Nebraska is a relatively new oil play for Credo where there is more opportunity to apply our regional concepts to higher potential wildcat drilling compared to the Central Kansas Uplift. For the last three years, we have been working to prove our technical concepts prior to ramping-up drilling to a level similar to our Kansas project. Among other things, we have been refining our 3?D seismic techniques and interpretations, and believe that we have made significant progress on cracking-the-code.”
To date, Credo has shot over 200 square miles of 3-D seismic in Kansas and Nebraska and has drilled 110 wells in Kansas and 18 wells in Nebraska. The Company’s drilling success rate is 40%, yielding “all in” risked adjusted internal rates of return (at current oil prices) of approximately 100%.
For fiscal 2012, the Company budgeted $9.8 million for drilling in Kansas and Nebraska, up 17% from last year. Forty five (45) additional oil wells are scheduled for the remainder of this year together with three new seismic shoots covering 66 square miles.
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