CALGARY, ALBERTA–(Marketwired – Sept. 6, 2016) – GRANITE OIL CORP. (“Granite” or the “Company”) (TSX:GXO)(OTCQX:GXOCF) is pleased to provide an update with respect to its recently commenced five well development drilling program that will be carried out in the second half of 2016.
Granite has invested significantly in the gas injection Enhanced Oil Recovery (“EOR”) scheme on its 100% owned and operated Bakken oil pool in 2016, taking advantage of low equipment costs and natural gas prices to return a significant portion of the oil pool to its original reservoir pressure ahead of schedule.
Granite has drilled, completed and brought on stream the 100/03-23-003-17W4/00 well located in the heart of Granite’s Bakken oil pool.
The 3-23 well produced an average of approximately 680 bbls/d of oil and 810 mscf/d of natural gas over a 96 hour production test. At the conclusion of the test, the well was flowing at approximately 745 bbls/d of oil and 1500 mscf/d of natural gas at a restricted flow rate with a wellhead pressure of 630 PSI. The all-in well cost of $1.2 million is in-line with Granite’s best results to-date and represents a 33% cost reduction relative to originally planned 2016 budgeted well costs of $1.8 million. The 3-23 well sets Granite’s new benchmark for starting capital efficiency due to the combination of the test results and all-costs. This is the first drill of a planned multi-well program on a pad site and future cost reductions are anticipated on subsequent drills.
Granite plans to drill an additional four wells prior to the end of 2016, all targeting the re-pressurized core of the Bakken oil pool. Approximately 80% of Granite’s capital will be focused on drilling for the remainder of 2016 and into the future as the Company shifts into a harvest model having now achieved key long term strategic objectives.
The Company will release guidance details for the balance of 2016 and beyond and post an updated presentation on its website at www.graniteoil.ca in mid-September 2016.