EnerJex Announces Stimulation of Three High Potential Oil Wells in South Texas
SAN ANTONIO, Nov. 29, 2011 /PRNewswire/ -- EnerJex Resources, Inc. (OTCMarkets:ENRJ) ("EnerJex" or the "Company"), a domestic onshore oil company, announced today that it has engaged Halliburton to stimulate three wells in South Texas that the Company successfully drilled and cased several months ago. One of the three wells was stimulated yesterday and the remaining two wells are scheduled to be stimulated today. EnerJex expects to announce initial production results from these wells in the coming weeks.
The three new wells are located in the Company's El Toro Project, which consists of more than 5,000 undeveloped acres in which EnerJex operates and owns working interests ranging from 40% to 48%. Each well was drilled to a true vertical depth of approximately 4,500 feet, targeting a formation that has produced more than 100 million barrels of oil in the nearby area since 1950. One producing well located on a lease directly adjacent to the El Toro Project was drilled in 1984 and has produced approximately 50,000 barrels of oil to date from the same formation targeted by the Company.
Each of the three new wells drilled by EnerJex is offset by successful oil-producing wells that were drilled in the El Toro Project during 2009. These offset producers achieved initial production rates of approximately 75 barrels of oil per day (BOPD) and averaged approximately 25 BOPD during the first 12 months of production. The rates of production from these offset wells provide an indication of the level of production that may be realized from the Company's three new wells, but the actual results of production from these wells may vary materially from that of the offset wells. EnerJex expects the gross cost to drill and complete each new well to be between $500,000 and $600,000. The Company owns a 40% working interest in each of the three new wells.
Management Comments
EnerJex's CEO, Robert Watson, Jr., commented, "The Company experienced delays in scheduling stimulation services due to the frenzy of activity in the Eagle Ford Shale play led by Chesapeak Energy and EOG Resources. Despite this challenge, we are excited to to bring these new wells online during a period in which oil prices are higher. EnerJex's El Toro Project holds tremendous potential, and we have identified numerous infill drilling locations that directly offset successful oil producing wells drilled during the past two years."
About EnerJex Resources, Inc.
EnerJex is a domestic onshore oil company with assets located in Eastern Kansas and South Texas. The Company's primary business is to acquire, develop, explore and produce oil properties onshore in the United States. Additional information is available on the Company's web site at www.enerjexresources.com.
Forward-Looking Statements
This press release and the materials referenced herein include "forward-looking statements" within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. Forward-looking statements give EnerJex's current expectations or forecasts of future events. The statements in this press release regarding the acquisition of operating assets and related agreements; any implied or perceived benefits from any current or future transaction, and any other effects resulting from any of the above, are forward-looking statements. Such statements involve risks and uncertainties, including but not limited to: whether acquired properties will produce at levels consistent with that of other nearby properties and with management's expectations; market conditions; the ability of EnerJex to obtain financing for continued drilling; the costs of operations; delays, and any other difficulties related to producing oil; the ability of EnerJex to integrate the newly purchased assets and any newly acquired employees; the price of oil; EnerJex's ability to market and sell produced minerals; the risks and effects of legal and administrative proceedings and governmental regulation; future financial and operational results; competition; general economic conditions; and the ability to manage and continue growth. Should one or more of these risks or uncertainties materialize, or should underlying assumptions prove incorrect, actual outcomes may vary materially from those indicated. Important factors that could cause actual results to differ materially from the forward-looking statements are set forth in our Form 10-K filed with the United States Securities and Exchange Commission and our Form 10-Q. EnerJex undertakes no obligation to revise or update such statements to reflect current events or circumstances after the date hereof or to reflect the occurrence of unanticipated events. EnerJex's production forecasts are dependent upon many assumptions, including estimates of production decline rates from existing wells and the outcome of future drilling activity. Although EnerJex believes the expectations and forecasts reflected in these and other forward-looking statements are reasonable, it can give no assurance they will prove to have been correct. They can be affected by inaccurate assumptions or by known or unknown risks and uncertainties.
Contact
Brad Holmes, Investor Relations | Robert Watson, Jr. CEO |
(713) 654-4009 | (210) 451-5545 |
[email protected] |
SOURCE EnerJex Resources, Inc.
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