Gastar Exploration Announces Initial Production From Multi-Lateral Production Pilot in Australia
June 18 2009 - 6:00AM
PR Newswire (US)
HOUSTON, June 18 /PRNewswire-FirstCall/ -- Gastar Exploration Ltd.
(NYSE Amex: GST; TSX: YGA) today announced that the aggregate rate
of gas production from the Bibblewindi multi-lateral production
pilots in its coal seam gas project in New South Wales, Australia
has reached 250,000 standard cubic feet per day. Water production
continues at approximately 3,500 to 4,000 barrels per day. Strong
water flows, the precursor to strong gas flows, have confirmed the
anticipated widespread fracture network and high permeability of
the Bohena coal seam. Full scale dewatering from the six production
wells commenced in early May 2009. It is expected that gas
production rates will continue to climb over coming months as
dewatering continues. Gastar holds a 35 percent working interest in
the project with the balance held by its joint development
operating partner, Eastern Star Gas
(ASX:ESGASX:andASX:OTCQX:ASX:ESGLY). J. Russell Porter, Gastar's
President and Chief Executive Officer, said, "The excellent early
performance of this production pilot is confirming our high
expectations for the project. We believe this puts us on track to
achieve our reserves upgrade targets as well as move forward to
project commercialization and full-scale development. "In addition,
the multi-lateral drilling design is proving to be a success and we
are now confident that we can comfortably drill laterals of over 1
km in length. We are also seeing clear pressure communication
between the lateral wells, which means the spacing between the
laterals can be greatly increased. We anticipate a spacing of up to
1 km will be achievable, increasing the total quantity of gas that
will be produced from each well and materially reducing gas
production costs. "We are particularly pleased that gas production
was immediate when dewatering of the multi-lateral pilots
commenced," added Mr. Porter. "This confirms the Bohena coal seam
is fully saturated and based on results we have seen so far, we
expect the gas content to be approximately 15 standard cubic metres
(530 standard cubic feet) per ton of coal." About Gastar
Exploration Gastar Exploration Ltd. is an exploration and
production company focused on finding and developing natural gas
assets in North America and Australia. The Company pursues a
strategy combining deep natural gas exploration and development
with lower risk CBM and shale resource development. The Company
owns and operates exploration and development acreage in the deep
Bossier gas play of East Texas and Marcellus Shale play in West
Virginia and Pennsylvania. Gastar's CBM activities are conducted
within the Powder River Basin of Wyoming and concentrated on more
than 6 million gross acres controlled by Gastar and its joint
development partner in Australia's Gunnedah Basin (PEL 238, PEL 433
and PEL 434) located in New South Wales. For more information,
visit our web site at http://www.gastar.com/. Safe Harbor Statement
and Disclaimer This news release includes "forward looking
statements" within the meaning of Section 27A of the Securities Act
of 1933 and Section 21E of the Securities Act of 1934. A statement
identified by the words "expects", "projects", "plans", and certain
of the other foregoing statements may be deemed forward-looking
statements. Although Gastar believes that the expectations
reflected in such forward-looking statements are reasonable, these
statements involve risks and uncertainties that may cause actual
future activities and results to be materially different from those
suggested or described in this news release. These include risks
inherent in the drilling of natural gas and oil wells, including
risks of fire, explosion, blowouts, pipe failure, casing collapse,
unusual or unexpected formation pressures, environmental hazards,
and other operating and production risks inherent in the natural
gas and oil drilling and production activities, which may
temporarily or permanently reduce production or cause initial
production or test results to not be indicative of future well
performance or delay the timing of sales or completion of drilling
operations, risks with respect to natural gas and oil prices, a
material decline in which could cause Gastar to delay or suspend
planned drilling operations or reduce production levels, and risks
relating to the availability of capital to fund drilling operations
that can be adversely affected by adverse drilling results,
production declines and declines in natural gas and oil prices and
other risk factors described in Gastar's Annual Report on Form
10-K, Quarterly Reports on Form 10-Q and other filings with the SEC
at http://www.sec.gov/ and on the System for Electronic Document
Analysis and Retrieval (SEDAR) at http://www.sedar.com/. The SEC
has generally permitted oil and gas companies in their filings with
the SEC to disclose only proved reserves that under SEC definitions
and guidelines a company has demonstrated by actual production or
conclusive formation tests to be economically and legally
producible under existing economic and operating conditions. This
news release discloses estimated "gas content" that the SEC's
guidelines would prohibit us from including in our filings with the
SEC. Estimates of gas content are preliminary, do not reflect
estimates of recoverable reserves and by their nature are more
speculative than estimates of proved reserves under SEC definitions
and guidelines. The NYSE Amex and Toronto Stock Exchange have not
reviewed and do not accept responsibility for the adequacy or
accuracy of this release. Company Contact: Gastar Exploration Ltd.
J. Russell Porter, Chief Executive Officer 713-739-1800 / Investor
Relations Counsel: Lisa Elliott / Anne Pearson DRG&E :
713-529-6600 / DATASOURCE: Gastar Exploration Ltd. CONTACT: J.
Russell Porter, Chief Executive Officer of Gastar Exploration Ltd.,
+1-713-739-1800, ; or Investor Relations Counsel, Lisa Elliott, ,
or Anne Pearson, , both of DRG&E, +1-713-529-6600, for Gastar
Exploration Ltd. Web Site: http://www.gastar.com/
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