Press Release |
Forent Energy- Corporate Update
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CALGARY, ALBERTA, Nov 01 (MARKET WIRE) -- Forent Energy Ltd. (TSX VENTURE:FEN) ("Forent" or the "Company") is announcing the following corporate operational updates. The farm-out agreement with BlackShale Resources Inc. ("BlackShale") that was announced on August 30, 2012 is moving forward with BlackShale expected to commence drilling of the first well in November. This vertical well will be drilled to the base of the Mannville Formation in order to evaluate all geological zones encountered. In addition to a full suite of well logs, BlackShale intends to take extensive core samples, specifically over the Second White Speck Formation ("2WS"). All technical data will be thoroughly evaluated over several months in order to determine the best completion methodology for the 2WS horizontal well that is expected to be drilled in 2013. Forent will also utilize the well data in order to further evaluate its 23 section, proprietary 3D seismic dataset. BlackShale is a private company that specializes in identifying and exploiting unconventional oil and gas opportunities in Canada. In mid-September a neighboring operating company initiated a well re-entry program on lands adjacent to Forent's Mervin oil field and salt water disposal well located in section 34-50-21W3. During the re-entry operations on the first well in this program, a deeper formation was inadvertently penetrated containing quantities of water with hydrogen sulfide ("H2S"). This H2S contaminated water flowed uncontrolled for a number of days into the Waseca formation, from which Forent was previously producing sweet oil, resulting in the Waseca formation becoming contaminated. As a result of H2S in the produced water, Forent shut in the Mervin field on September 22nd as a safety precaution. Upon taking appropriate operating measures to remove the H2S from the produced water, oilfield operations were restarted on October 4th. At the present time the Company is seeing several positive indications such as the return of casing gas, reduced fluid in the six well bores and a modest return in oil production. During the second and third quarters of this year Mervin's oil production averaged more than 150 bbl/day. The Company's cash flow is expected to be materially impacted in the third and fourth quarters of 2012, until normalized production resumes. Forent is in discussions with the offsetting company in order to restore full production as quickly as possible, address ongoing operational matters and consider appropriate compensation for the impairment of the Company's Mervin field. The Company is assessing the next steps in its Alton, Nova Scotia exploration program. The results from the two wells drilled earlier this year have been incorporated into Forent's geological model and based on this assessment, the Company believes that at least another 10 - 12 additional reef prospects exist in the area. Shares of Forent trade on the TSX Venture Exchange under the symbol "FEN". Except for statements of historical fact, this news release contains certain "forward-looking information" within the meaning of applicable securities law. Forward-looking information is frequently characterized by words such as "plan", "expect", "project", "intend", "believe", "anticipate", "estimate" and other similar words, or statements that certain events or conditions "may" or "will" occur. Forward-looking statements such as the estimates of reserves, the references to Forent's exploration program and drilling program and capital expenditures relating to, and timing of, such programs are based on the opinions and estimates at the date the statements are made, and are subject to a variety of risks and uncertainties and other factors that could cause actual events or results to differ materially from those anticipated in the forward-looking statements. There are uncertainties inherent in forward-looking information, including factors beyond Forent's control, and no assurance can be given that the programs will be completed on time, on budget or at all. In addition, there are numerous uncertainties inherent in estimating reserves, including many factors beyond Forent's control, and no assurance can be given that the indicated level of reserves or the recovery thereof will be realized. Forent undertakes no obligation to update forward-looking information if circumstances or management's estimates or opinions should change except as required by law. The reader is cautioned not to place undue reliance on forward-looking statements. Additional information identifying risks and uncertainties that could affect financial results is contained in Forent's filings with Canadian securities regulators, which filings are available at www.sedar.com. Trading in the securities of Forent Energy Ltd. should be considered highly speculative. Neither the TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release. Contacts: Forent Energy Ltd. Tom Lester President, CEO & CFO (403) 262-9444 #203 firstname.lastname@example.org www.forentenergy.com Copyright 2012, Market Wire, All rights reserved. -0-