With a large tenure located in Canada’s hottest oil and gas field, the Montney in British Columbia, Calima Energy (ASX:CE1) has just completed its maiden horizontal well as part of an initial three-well program.
The horizontal section of the new well stretches for approximately 2,500 metres, through Montney Formation geology, which is anticipated to be hydrocarbon-bearing and liquids-rich.
Following the completion of horizontal drilling the company will look to conduct production testing.
Drill core and wireline log data from Calima’s maiden vertical well returned highly positive results, suggesting its well locations represent a valid analogue to other nearby Montney operators.
The team in Canada continues to deliver excellent operational performance and we are delighted with the data received to date,” Calima Energy managing director Alan Stein said.
“The Calima-1 well encountered a full sequence of the Montney Formation which is comparable to the sections being produced by other Operators in the region and data recovered from the first horizontal well is also encouraging,” he said.
Calima holds a large 72,0000 acres in a northern extension of the Montney Formation, with the latest round of drilling set to draw attention to the continuing expansion of the Montney fairway.
The region is also experiencing an infrastructure boom with an identified C$7.5 billion to be piled in to the region to increase production by 2022.
Calima’s core land is located adjacent to existing pipelines, with further network additions to be built nearby.
Key to massive expansion in the Montney is a consortium, led by Shell which has agreed to invest C$40billion in an LNG terminal on Canada’s West Coast.
The terminal will open up Montney gas to international buyers, lifting the region’s current economics and is also the largest ever infrastructure project in Canada.