Turnkey E&P Inc.

Turnkey E&P Inc.

August 05, 2008 20:13 ET

Turnkey E&P Inc. Announces Successful Completion of McPherson # 1 Well and the Drilling of the Vieman # 1 Well

CALGARY, ALBERTA--(Marketwire - Aug. 5, 2008) - Turnkey E&P Inc. ("Turnkey") (TSX:TKY) today announced that it has successfully completed the first well drilled in the Hurricane Creek field. The McPherson # 1 well has been on gas-lift production for the last 5 days and has produced at a rate of 8-12 barrels of oil per hour, averaging over 200 BOPD. The well is producing no water and approximately 50 MCFD of gas. Turnkey has 100% working interest and a 74% net revenue interest in the well.

The McPherson # 1 is producing from the Doornbos sand at approximately 8100'. The Hurricane Creek field is comprised of approximately 2,800 acres and is located in Beauregard and Allen Parishes in Louisiana and was discovered in the late 40's. Engineering studies have shown the Doornbos sand to contain 60 million barrels of high gravity oil in place initially and that only 2.6 million barrels have been produced. The Doornbos reservoir is a highly laminated sand/shale reservoir that averages 100 feet in thickness across the entire Hurricane Creek field which is unitized and held by production. Turnkey believes that drilling the well with casing and completing the well in an underbalanced stimulated environment, has reduced formation damage and contributed to the excellent results.

Plans are in place to immediately spud another well from the same surface location and directionally drill at a high angle through this laminated reservoir to enhance production. Should this technique yield the desired results, the company plans to drill up to 10 additional wells from this pad. To fully exploit the production from this field, up to three more multi well pads would be required.

Turnkey is also pleased to announce the drilling of the Vieman #1 well on the Danbury Dome leases onshore Texas. The drillsite location is currently being constructed and one of Turnkey's Casing Drilling® rigs is scheduled to move to the location around August 15th. The company estimates that the low-risk attic prospect has possible reserves estimated at 28 BCF. The Turnkey Vieman #1 well is located up dip from the Humble Vieman #1 well that tested 85 MMCFD and watered out in 1965. The existing prospect is defined by 3-D seismic data and is expected to be encountered at depths between 13,000 and 13,500 ft.

The Vieman No. 1 well, is estimated to drill in 45 days costing an estimated US$5.2m. An additional 30 days and US$1m is estimated to complete and test the well. Turnkey will drill the well on a "turnkey" drilling basis and participate with a 25% working interest that reverts to an 18.75% working interest after project payout. The net revenue interest in the project is 74%.

Turnkey E&P Inc. is a drilling and completions contractor and an independent oil and gas company that is focusing its oil and natural gas drilling, exploration and production activities in the continental United States using Casing Drilling® technology. Casing Drilling® is a registered trademark of Tesco Corporation. Additional information about Turnkey can be found at its website: www.turnkeyep.com.

This release and the Company's website referenced in this release contain forward-looking statements including expectations of future production and components of cash flow and earnings. Investors are cautioned that assumptions used in the preparation of such information may prove to be incorrect. Events or circumstances may cause actual results to differ materially from those predicted, a result of numerous known and unknown risks, uncertainties, and other factors, many of which are beyond the control of Turnkey. These risks include, but are not limited to; the risks associated with the oil and gas industry, commodity prices and exchange rate changes. Industry related risks could include, but are not limited to; operational risks in exploration, development and production, delays or changes in plans, risks associated to the uncertainty of reserve estimates, health and safety risks including, without limitation, blowouts and spills, and the uncertainty of estimates and projections of production, costs and expenses. The risks outlined above should not be construed as exhaustive. Investors are cautioned not to place undue reliance on any forward-looking information. Turnkey undertakes no obligation to update or revise any forward-looking statements except as required under applicable securities laws.

Contact Information

  • Turnkey E&P Inc.
    R. M. (Bob) Tessari
    President and Chief Executive Officer
    (281) 248-8822
    Website: www.turnkeyep.com