Clayton Williams Energy Provides Update on Operations
March 12 2008 - 7:50AM
Business Wire
Clayton Williams Energy, Inc. (NASDAQ:CWEI) today provided an
update on its exploration and development activities by area. East
Texas Bossier The Company has drilled two wells targeting the deep
Bossier sands in East Texas: the Big Bill Simpson #1, a 19,000-foot
exploratory well in Leon County (70% working interest), and the
Margarita #1, a 20,000-foot exploratory well in Robertson County
(100% working interest). The Big Bill Simpson #1 is currently
producing approximately 500 gross (263 net) Mcf of gas per day, and
the Margarita #1 is waiting on completion of pipeline facilities to
begin production, but is expected to initially produce
approximately 750 gross (563 net) Mcf of gas per day, based on well
test data. The Big Bill Simpson encountered a thick section of
lower and middle Bossier sands, but these sands had limited
porosity. The Margarita well encountered only the upper Bossier
sands. The Company plans to conduct a 3D seismic shoot over the Big
Bill Simpson prospect in 2008 in an attempt to high grade possible
locations for future drilling on this acreage. �Although the
production from these wells is non-commercial, we remain optimistic
about our Bossier acreage,� stated Clayton W. Williams, Jr., the
Company�s President and Chief Executive Officer. �Currently, we
have 142,000 net acres under lease in the East Texas Bossier play,
of which approximately 70,000 net acres are held by production. We
also have approximately 170,000 net acres under lease in our
Louisiana Bossier play.� North Louisiana The Company continues to
be encouraged by the results of its drilling program in the
Terryville prospect in Lincoln Parish, where it has drilled a total
of 13 wells in the Cotton Valley/Gray sand intervals since
mid-2006. These wells are currently producing at combined rates of
approximately 10,700 Mcf of gas per day and 310 barrels of oil per
day, net to the Company�s interest. The Company plans to drill five
more development wells on the Terryville prospect in 2008. In
Lincoln Parish, on the Ruston prospect, the Company has drilled the
LA Minerals #1 which is producing from the Gray sand. The Company
is currently drilling the J.G. Mitchell #1 and plans to drill
another three wells on this prospect in 2008. South Louisiana As
previously reported, the Company has entered into an exploration
agreement with an industry partner covering six of the Company�s
exploratory prospects in South Louisiana. The terms of the
agreement obligate the industry partner to drill up to six wells,
with the first well scheduled to commence mid-year. The partner
will bear 85% of all drilling costs incurred to casing point and
50% of all subsequent costs to earn a 50% working interest in the
wells. In addition, the Company plans to drill the third well on
its Fleur prospect to accelerate the production from an oil sand
that is behind pipe in one of the existing wells on this prospect.
Austin Chalk (Trend) The Company has begun an infill drilling
program in the Austin Chalk (Trend), an oil-prone formation where
the Company has significant holdings in Robertson, Burleson,
Brazos, Milam and Leon Counties, Texas. Most of the wells in this
area were drilled as horizontal wells, many with multiple laterals
in different producing horizons. By increasing the density of the
wells, the Company is adding new reserves and accelerating
production from this field. Results of the program have been very
encouraging to date. The Company currently has two drilling rigs
operating in the area, and continues to supplement the drilling
program with secondary re-fracturing operations on existing wells
designed to improve production and add reserves. Permian Basin In
the Permian Basin, the Company has a significant acreage position
with a large inventory of potential drilling and recompletion
projects. The Company intends to utilize four drilling rigs
throughout the year in this area. Most of the activity is on the
Company�s War-Wink and Amacker-Tippett prospects in West Texas. In
the War-Wink area, the Company is presently drilling horizontal
wells targeting oil-prone sands in the Bone Spring formation and
has identified at least 10 other possible locations to further
exploit this area. On the Amacker-Tippett prospect, the Company has
identified 15 possible locations on which to drill vertical wells.
These wells will target oil-prone sands in the Spraberry and
Wolfcamp formations, which are encountered at depths ranging from
7,000 to 10,500 feet. The Company has also identified several
recompletion opportunities on existing vertical wells in the area.
Other Activity In Utah, the Company plans to participate in the
drilling of a 12,000-foot exploratory well in the Overthrust
prospect (33% working interest) in Sanpete County, Utah. The well
will target the oil-prone Navajo sandstone formation. Clayton
Williams Energy, Inc. is an independent energy company located in
Midland, Texas. Except for historical information, statements made
in this release are forward-looking statements within the meaning
of Section 27A of the Securities Act of 1933 and Section 21E of the
Securities Exchange Act of 1934. These statements are based on
assumptions and estimates that management believes are reasonable
based on currently available information; however, management's
assumptions and the Company's future performance are subject to a
wide range of business risks and uncertainties, and there is no
assurance that these goals and projections can or will be met. Any
number of factors could cause actual results to differ materially
from those in the forward-looking statements, including, but not
limited to, production variance from expectations, volatility of
oil and gas prices, the need to develop and replace reserves, the
substantial capital expenditures required to fund operations,
exploration risks, uncertainties about estimates of reserves,
competition, government regulation, costs and results of drilling
new projects, and mechanical and other inherent risks associated
with oil and gas production. These risks and uncertainties are
described in the Company's filings with the Securities and Exchange
Commission. The Company undertakes no obligation to publicly update
or revise any forward-looking statements.
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