Wednesday, 23 January 2013

Caza's latest Bone Spring well gets underway; completes deal to expand New Mexico interests

Caza Oil & Gas (LON:CAZA, TSE:CAZ) has begun work on its latest well targeting the exciting Bone Spring play in New Mexico.
The Lennox No. 2H horizontal well will be drilled to a vertical depth of 11,850 feet and its potential secondary targets are the Delaware, Lower Brushy Canyon, Avalon and Wolfcamp formations. Caza currently has a 40% working interest in the well.
Separately, the group said it has traded a 20% working interest in the Lennox leases for 20% of Roja and Madera prospects in Lea County, New Mexico, operated by Occidental Petroleum(OXY). OXY is planning to drill two wells on each lease later this year.
Roja is a 280 acre lease 18 miles south of the company’s Copperline Prospect, and Madera is a 1,400 acre lease a further two miles in the same direction.
On Copperline, Caza has applied for a permit to drill the 4H horizontal well as a direct offset to the 3H, its third Bone Spring well.
At Quail Ridge, also in Lea County, the 4H horizontal well has reached its intended total depth of 15,605 feet and will be completed in the third Bone Spring sand. It has a 0.25% working interest in the prospect, though it provides valuable drilling and completion data.
In all, Caza has 4,070 net acres in the emerging Bone Spring play. It said leasing and drilling activity continues to increase in the area and initial producing well rates continue to improve with technological advances in drilling and frack designs.
Chief executive Michael Ford said: “We continue to progress our Bone Spring drilling programme in southeast New Mexico, and are very pleased to have commenced drilling operations on the Lennox horizontal Bone Spring prospect.
“This is the company’s third operated Bone Spring test well with a material participation interest since August 2012.
“We are equally pleased to have closed the working interest trade for interests in Madera and Roja prospects.
“These are very good projects, and we look forward to participating in test wells to be drilled on them along with a development well at Copperline later this year.
“Additionally, the Quail Ridge wells continue to produce good results and provide valuable drilling and completion information.
“This bodes well for future drilling operations on our Lynch property, located in the adjacent section, as well as the company’s other horizontal Bone Spring projects.”

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