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Calima Energy prepares to spud second Leo well at Thorsby in Alberta

Published: 12:13 26 Aug 2021 AEST

Calima Energy Ltd -

Calima Energy Ltd (ASX:CE1) plans to spud the second well in the Leo Drilling Campaign at Thorsby, Alberta, on Friday, August 27, following a hiatus since its last drilling at the Thorsby development field in January 2019.

The company has completed Leo #1 well through the Sparky play and the well bore is being conditioned for cementing.

Leo #1 well was drilled horizontal for 3,800 metres and logs indicate the well is within expected reservoir quality with oil and gas shows as prognosed.

The rig will be skidded over around 15 metres and the next Sparky well, Leo #2, is expected to be spud this Friday.

“Drilling near some of best wells to date”

CE1 chief executive officer Jordan Kevol said: “We are very excited to be back drilling in Thorsby.

“We are drilling near some of our best wells to date and planning to implement a higher frac intensity relative to the previous wells with improved economics expected.

“The three wells have minimal on-lease tie-in’s and will flow into our existing oil processing facilities that have ample room for the hydrocarbons.

“We have a lot of running room in the Thorsby Sparky play, and these wells are expected to be very impactful to our bottom line with IP90s of up to 460 barrels of oil per day.”

Production set for Q4

Calima plans to spud Leo #3 immediately following Leo #2 from the same pad with production scheduled to come on stream in the fourth quarter of 2021. 

Thorsby provides a land base of around 108 net sections (69,120 net acres) that can be developed from multi-well pads, all of which have year-round access and minimise the environmental footprint, with oil processing facilities of 3,000 bbl/d oil capacity.

The completion and fracture process for the three Leo wells is expected to begin in the fourth week of September with initial production in late October anticipated.

Sparky drilling and production timeline. 

All wells are being drilled from a single pad adjacent to Calima's oil processing facility.

This pad contains two of the best performing Thorsby Sparky wells which combined have produced greater than 300 mbbl oil and 370 mboe since July 2018.

A total of 11 Sparky wells have been drilled to date with the tier-1 wells (second generation) averaging around 3,400 metres with 36 fracture stages averaging 0.75 tonnes of sand per metre.

Leo 1, 2 and 3 Sparky wells (third generation) have been optimised and will average around 3,800 metres (400 metres longer) and around 50 fracture stages averaging 1.0 tonnes of sand per metre over the horizontal length.

Next steps

Wells average about 10 days each to drill and will be subsequently fracture stimulated as part of the completion process.

The optimised wells are budgeted for $3.2 million per well and the company anticipates IP90 rates of 270- 460 boe/d (80% oil) and cumulative production of up to 462,000 boe.

Well paybacks are 5-10 months and the NPV at 10% discount is around C$6.5-$8.8 million.

IP90 production rates per well are modelled at around 274-460 bbl/d with NPV10 of C$6.5-$8.8 million based on EURs of 352,000-462,000 boe with 80% oil. 

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