During the quarter the company completed the Canadian Discovery study of core and testing data was completed confirming the presence of high productivity zones in the sections tested by the Calima-2 and Calima-3 wells.
Core data from Calima-1 indicates a resource potential in the Lower Montney that is underdeveloped in the basin and currently not incorporated in the Company’s resource statement, delivering future upside.
The company also installed additional tankage was installed at the Paradise oil well to reduce production shut-in due to weather.
Canadian Discovery Findings
During the quarter the company concluded the Canadian Discovery’s findings that indicated pressure and flow test results from the Upper Middle Montney in Calima-2 and the Upper Montney in Calima-3, in addition to core analysis from Calima-1, pointing the presence of high productivity Montney zones at the northern edge of the current Montney fairway.
Regional mapping and the production history of analogue wells at Laprise and Birley Creek also point to Calima’s wells becoming strong performers.
As of November 2020, Calima holds approximately 26,000 hectares of Montney rights, over half of which have been converted to leases, with expiry dates no earlier than June 2029.
Combining this land base with the company’s recent acquisition of infrastructure at Tommy Lakes, and receipt of approval to construct a pipeline from its recent wells to that infrastructure, Calima is well-positioned to build forward on its current Montney development.
Tommy Lakes Facilities
In April last year, the company closed its acquisition of compression facilities, associated pipelines and infrastructure in the Tommy Lakes Field which is 20 kilometres to the north of the Calima Lands.
The Facilities provide cost-efficient access to North River Midstream pipeline and Jedney processing facility and access to regional markets via the major pipeline networks including NGTL, Alliance and T-North.
The Tommy Lake infrastructure continues to be maintained by Sproule and Associates with their local field operations staff.
Winterization of camp facilities and preservation of assets has been completed.
The Paradise well is around 40 kilometres to the northeast of Fort St John and 250 kilometres to the southeast of the company’s extensive Montney interests in northeast British Columbia.
Total production days for the period was 86 days, resulting in 1,789 barrels of oil total.
Calima completed the installation of additional oil storage during September which added 800 barrels of oil storage on location will ensure a higher number of days on production.
The additional storage capacity has already increased quarterly productive days by around 10% from the previous quarter.
Montney Regional Activity Update
Paramount has committed to accelerating its 2021 development plans with C$60 million of capital spending at its Karr and Wapiti assets.
The additional spending will grow Montney production from the two assets for 2021.
CNRL closed the C$461 million purchase of Montney-focused Painted Pony on 6 October 2020.
CNRL holds 1 million net acres in the Montney, one of the largest positions in its peer group and the Painted Pony assets consist of 277,568 net acres in Northeast British Columbia and 5,120 net acres in Alberta.
Advantage has brought forward a four-well Montney pad into December 2020 Quarter increasing its projected 2020 Capex by C$17 million to a range of C$147-162 million.
The company is drilling the four wells in the Glacier area, with two each targeting the D4 Montney and Upper Montney intervals.
Production from all 10 wells will be processed using existing capacity at Advantage’s 400 MMcf/d Glacier gas plant, with payout expected within a year of their spud dates.
Keyera Corp’s Pipestone gas processing and liquids stabilization facility has started operations enabling Ovintiv to maximize its condensate-rich Montney production and grow its resource base in the area while optimizing midstream fees by routing production to gathering systems with lower line pressures.
Ovintiv will use 170 MMcf/d and 19,000 barrels/day of the plant’s 200 MMcf/d and 24,000 barrels/day capacity under a fee-for-service agreement.
The company achieved a record completion rate of 3,450 ft/day on a recent four-well pad at Pipestone, 45% faster than its 2019 average.