Aurex Energy Corp. (TSXV:AURX) (“AURX” or the “Company”, TSXV:AURX) today announced that it has finalized planning for the initial phase of work on its 10-well program in the Barnett Shale, Texas.
The Company’s primary property (held in a wholly-owned US subsidiary) consists of 10 shut-in natural gas wells (8 horizontal wells and 2 vertical wells) on 1,400 acres located in the Fort Worth Basin. The Company intends to re-work and re-fracture the shut-in wells with the goal of generating significant cashflows to expand and develop an asset base of both producing oil and gas and mineral properties. Total Proved Plus Probable Reserves are 24.6 Billion Cubic Feet (“BCF”) of natural gas. The estimated Net Present Value (“NPV”) of the net revenue (after all operating costs, royalties and taxes) from the Proved Plus Probable Reserves, using forecast pricing, is US$22.0 million. Peak operating cash-flow (before income taxes), after reworking all wells, is estimated at US$10.8 million per year. Estimated reserves and economic valuations are from a NI51-101 report titled “Appraisal Of Certain Oil And Gas Interests located In Hill, Hood, Parker And Tarrant Counties, Texas As Of January 1, 2019” prepared by a Qualified Reserves Evaluator (“QRE”), MKM Engineering, for Canadian Platinum Corp. (now Aurex Energy Corp.) and dated December 28, 2018.
The initial phase of work will focus on five of the ten wells: one vertical and four horizontal wells. Gauges on the four horizontal wells indicate that the wells have repressurized to their initial production pressures. After assessing the condition of the surface equipment and facilities, wellbore and casing, and refurbishing where required, the horizontal wells will be brought back on stream to resume conventional production for a period of time. The vertical well will be completed and brought on stream conventionally. The wells will produce for several months, generating cash flow, after which the horizontal wells will undergo a refracking program designed to increase recoverable reserves and improve production. Studies indicate that up to 80% of the horizontal length of the wells were unstimulated after the original fracking. This, combined with poor performance from the fractures that did stimulate the reservoir, resulted in possibly as little as 8% to 12% of the recoverable natural gas reserves being deliverable. The second phase of work will repeat the program on the remaining four horizontal wells and one vertical well.
In an ongoing assessment of the potential of this approach to increasing production from the Barnett Shale, the public record indicates over 3,500 shut-in horizontal wells in the East Newark (Barnett Shale) gas field. This provides an opportunity, through due diligence and careful selection, to significantly add to the size of the project.
Gary Billingsley, President, comments “We look forward to getting the Barnett Shale project underway, with the goal of generating near-term cash flow, proving the concept, and expanding the size of the project.”
About Aurex Energy Corp.
Aurex Energy Corp. is a Canadian-based resource exploration and development company with its head office in Saskatoon, SK. Aurex is focused on the acquisition and development of a diversified portfolio of resource properties critical to current and future energy production. This includes natural gas for LNG, base metals including copper and zinc, platinum group elements, strategic metals including cobalt, and precious metals.
AUREX ENERGY CORP. TRADES ON THE TSX VENTURE EXCHANGE UNDER THE SYMBOL “AURX”.
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Aurex Energy Corp.
Gary Billingsley, President
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