The new funds will be used to consolidate and fast track the development at Wizard Lake Project comprising the staged acquisition to 100% ownership and the drilling of more wells.
The company has reached an agreement to acquire the remaining interest in Wizard Lake from Point Loma for C$4 million cash ($1.2 million upfront) and C$2 million in Whitebark shares in two stages.
Whitebark will continue to develop Wizard Lake throughout CY2020 after recently completing its third well, Rex-3 on the project.
Wizard Lake could host ~20 more wells
Whitebark’s managing director David Messina said: “We have been very focussed on Wizard Lake this year and have taken the asset from an exploration opportunity to a fully operating and successful oil field in 12 months.
“The verification of acquiring a 100% of the field has been reinforced by this week’s excellent production results from Rex-3 which showed wells on the field are capable of yielding initial rates of over 1000 bopd.
“With ~20 future well location to choose from we will now be able to move ahead with our development activities without impediment and confident that WBE will reap full value from its efforts.”
Advanced discussions for funding package
Additionally, Whitebark is in advanced discussions with a major financial institution regarding a funding package.
The proposed funding package may be applied towards the Wizard Lake Field acquisition, future development activities and growth initiatives.
Rex-3 well recently flow tested
Drilling of the third well Rex-3 follows the recent construction work to expand processing facilities at Wizard Lake.
The expanded facilities will be capable of handling 5,000 barrels of fluid a day along with 5 million cubic feet per day (mmcfd) of gas.
The initial flow rates for Rex-3 were substantially greater than those seen in the previous successful Rex-1 and Rex-2 wells.
Rex-3 averaged 1,278 barrels of oil equivalent (boe) per day including 1,084 barrels of oil per day in the final 6 hours of a continuous 18 hour period.