Earlier today, Torchlight Energy
Resources, Inc. (NASDAQ: TRCH) announced that the Orogrande Development
Committee, which consists of members of the project operator, Torchlight and
consulting geologist Rich Masterson, has elected to move forward on planning
the next phase of drilling in the Orogrande Project. Following this decision,
the project operator is expected to permit three new wells, beginning with the
University Founders B-19 #1 well, to be drilled vertically for test purposes.
These new wells will be designed with sufficient casing size to support lateral
entry into any pay zones encountered during testing – including pay zones
previously observed in the existing Cactus well.
“We are pleased that the project
operator is underway on next steps in evaluating our Orogrande Project,” Will
McAndrew III, chief operating officer of Torchlight, stated in the news
release. “Drilling additional test wells is the appropriate next action,
providing data necessary for validation of the play and the development plan
for the entire 168,000 acres. Our principal strategy is to create control data
by strategically placing wells across the acreage and thus creating a
development thesis for the entire basin.”
Field operations stemming from
this agreement are set to begin within 90 days and in line with the development
agreement. Last September, Torchlight announced entry into a definitive
agreement with Founders Oil and Gas, LLC of Midland, Texas, through which
Founders will contribute $50 million in development capital by 2017 – including
a $5 million reimbursement for initial project costs – in exchange for 50
percent working interest in the Orogrande Project. Following the commencement
of new drilling operations, Torchlight will receive a payment of $500,000 resulting
from this partnership.
“The capital and expertise being
provided by our operating partner has set the stage for continued value
creation for Torchlight and our shareholders,” concluded McAndrew.
Currently, Torchlight owns 95
percent working interest in the 168,000 acre Orogrande Project, which is
located in Hudspeth County, Texas. The company is targeting 1,300 feet of pay
at a depth of approximately 4,000 to 6,100 feet. In prior testing, Torchlight
utilized the Rich A-11 well to gather key data for its field development
thesis, but a poor cement bond discovered during testing prevented a
cost-effective production test of the project’s primary pay zones. Repairing
these defects was determined to be economically unfeasible, and, as a result,
the development committee approved plans for drilling of the next wells with
larger casings that can be utilized for both testing and commercial production
moving forward.
For more information on the
company, visit www.TorchlightEnergy.com
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