Hemisphere completed construction of its new injection plant at the Atlee Buffalo F pool battery during the summer and moved into the early stages of tertiary recovery for the pool in August. Through the fourth quarter, the Company plans to expand its oil battery with the addition of a new treater, allowing for higher production from the pool over the coming years.
The surfactant-polymer (“SP”) flood is expected to help reduce water channeling in the reservoir by slowing down movement of the injectant relative to the oil, and to maximize reservoir sweep by reducing interfacial tension between oil and water. The addition of surfactant may also serve as an injectant aid, allowing more volumes of injectant to cycle through the reservoir over the life of the project. Overall recovery of oil from the pool is modelled to increase by up to 50% under this flood, as compared to waterflood alone. Management believes there will be a gradual production response to the SP flood with limited impact in the coming year. This strategic investment is expected to add long term value to shareholders by supporting the Company’s low decline and extending the life of its assets.
Drilling and Operations Update
In September, Hemisphere commenced a drilling program across its Southern Alberta assets. Up to four wells will be drilled in this program to test potential new pools, pool extensions, and new production technologies. Successful wells are anticipated to be brought online through the fourth quarter.
Well data from the spring drilling program indicated that the northwest portion of the G pool requires pressure maintenance, with seven producers and only one injector in the area. As a result, the Company recently converted one production well to an injection well, and is waiting on approval to convert another shortly. These conversions are expected to lead to increased production at offsetting producing wells in the future. Hemisphere anticipates third quarter production to be between 2,800-2,900 boe/d (99% heavy crude oil), due to low reservoir pressure in the area of the new wells, along with unplanned facility downtime at Hemisphere’s G pool facility in August and a planned G pool facility turnaround in late September.