EUREKA ENERGY LTD
(ASX: EKA, "Company" or "Eure ka) ASX RELEASE
21 DECEMBER 2011
SU G A R L O A F OP E RA T I ON S A N D P RODU CT I O N U P D A T E
Eureka is pleased to provide the following update on
operations and production for the Company's Eagle Ford Shale
acreage at the Sugarloaf Area of Mutual Interest ("AMI") in
Texas, USA. As of November 1st 2011, the
Sugarloaf wells are all operated by Marathon Oil Corporation
("Marathon").
As at report date there were 24 producing wells in which
Eureka holds an interest, including 6 farmout wells. Eureka
has been advised by Hilcorp that the cost recovery mechanism
on the farmout pool of 3 new Sugarloaf wells has been repaid
and that Eureka will participate in the revenue from those
wells from October. Eureka has been advised that the payout
period has taken considerably longer than the simple cost
recovery of well Capex because of the inclusion of additional
infrastructure costs in the payout calculation mechanism.
This infrastructure has facilitated early field
production.
Sugarloaf AMI gross production in November was 230,973 boe
which comprises 135,064bbls oil and 34,527bbls NGLs and
368.3MMcf of gas by volume. Production figures have been
influenced by a number of wells being shut in for the
installation of production tubing during November; the
figures this month do not reflect field production capacity.
ABN 46 116 829 139
LEVEL 3, 3 ORD STREET WEST PERTH WA 6005 TELEPHONE: FAX: +61 8 9321 9337 +61 8 6314 1557 www.eurekaenergy.com.auPR O D U C T I O N D A T A
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The following wells have been on production for a period of either 30 or 60 days and Eureka is pleased to provide the market with an update on the produced volumes during that period:-
*The equivalent barrels per day production rate has been calculated on a simple 6:1 ratio.
OP E R A T I ON S
Following the assumption of Operatorship, Marathon advised
that it planned a systematic program of tubing installation
across the wells in the field. The majority of the wells have
to date produced through 5 ½" production casing and are to
have 2 3/8" production tubing installed with gas lift valves
for future purposes. The smaller bore tubing will help
optimise the lift performance of these high liquid content
wells.
In addition the following operations have taken place:-
HOLLAND OPIELA #1H (0.73% WI)
The Holland Opiela #1H well commenced production on December
8th 2011. ASX participants in the Sugarloaf AMI
are:
Eureka (ASX:EKA) - 6.25%
Aurora (ASX:AUT) - 15.7% AWE (ASX:AWE) - 10%
Yours sincerely
EUREKA ENERGY LIMITED
Peter Mills
Managing Director
Technical Information contained in this report has been reviewed by Mr Peter Mills B.Eng, Managing Director of Eureka who has had 29 years experience in petroleum engineering and
has consented to the inclusion of the information in the form and context in which it appears.
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Sugarloaf Operations Update |