TORONTO, ONTARIO--(CCNMatthews - July 31, 2006) - Westchester Resources Inc. (TSX VENTURE:WSR) ("Westchester" or the "Company"), today announced that it has been informed by its operator and Joint Venture Partner that six horizontal wells have been drilled and cased since April 2006 on the Joint Venture's acreage in the Daly Field in Manitoba, as part of a phased development program. Wells 1 through 5 were drilled in an eastern section of the acreage to further define the geological characteristics of the Upper Lodgepole, Middle Daly, and Bakken zones. The sixth well was drilled in the southern area of the acreage and targeted the Middle Daly zone. Completion and production testing of the six wells is ongoing.
The contracted drilling equipment has been moved to drill a seventh well, the tenth well drilled overall since inception of the Manitoba drilling program. This well is planned as a vertical water disposal well and is to be drilled from the same pad as the first two wells in the program that were drilled in the third quarter of 2005. Once this well is completed, the drilling rig will be released to another operator for two months.
After the scheduled break in drilling, the Joint Venture plans to continue its drilling program on the acquired acreage. Two of the first three wells drilled last October in the first phase of drilling are oil productive. They are currently constrained due to the mechanical limitations of disposing large volumes of water. Once the water disposal well is operable, these two wells will be placed on production with much higher rates of oil volumes anticipated and lower water handling and operating costs.
The most recent wells, drilled since April 2006, were drilled higher structurally with encouraging results. All of the wells drilled established the presence of oil. However, due to the lower permeability in this portion of the field an acid stimulation program is being implemented to maximize well productivities. To date, two wells have been stimulated with acid. One well responded successfully to the acid treatment and the other well showed minimal response to acidization. Acid treatment is now planned for three more of the additional wells drilled since April 2006. Results will be released after treating and testing of the wells is completed
The two-month break in drilling will provide the Joint Venture additional time to continue the acid treatment program and establish a production profile for the area. It will also allow the participants to identify the best targets for future drilling and to optimize the development of the company's lands. The Joint Venture has over 3,000 acres in the Daly Field that presents significant opportunities to utilize horizontal drilling to find and produce oil from a proven reservoir.
Westchester owns a 50 percent working interest in the Daly Field leases through its Joint Venture Agreement (the "Joint Venture") with Aspen Group Resources Corp. (TSX:ASR), the operator on the project.
Westchester Resources Inc. is an independent oil and gas exploration and development company. Westchester's operations are focused in North America. The Company's shares trade on the TSX Venture Exchange under the symbol "WSR".
Forward Looking Statements - Certain information regarding Westchester set forth in this news release may contain forward-looking statements that involve substantial known and unknown risks and uncertainties. These forward-looking statements are subject to numerous risks and uncertainties, certain of which are beyond Westchester's control, including, but not limited to the impact of general economic conditions, industry conditions, volatility of commodity prices, risks associated with the uncertainty of reserve estimates, currency fluctuations and exploration risk. In addition, there can be no assurance that the flow rate estimated herein can be maintained with the testing conducted. Readers are cautioned that the assumptions used in the preparation of such information, although considered reasonable at the time of preparation, may prove to be imprecise and, as such, undue reliance should not be placed on forward-looking statements.
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Westchester Resources Inc.