Compass Petroleum Ltd.

Compass Petroleum Ltd.

September 09, 2010 10:50 ET

Compass Petroleum Ltd. Provides Update Concerning Viking Light Oil Horizontal Wells In Dodsland Area of Saskatchewan and Drilling Program

CALGARY, ALBERTA--(Marketwire - Sept. 9, 2010) -

Compass Petroleum Ltd. ("Compass" or the "Corporation") (TSX VENTURE:CPO) is pleased to provide an update concerning the Viking light oil horizontal wells recently drilled by the Corporation at its Lucky Hills property in the Dodsland area of west central Saskatchewan.

Certain statements in this news release respecting the anticipated drilling of Viking horizontal wells at Lucky Hills (commencing in late September 2010) constitute forward-looking statements. Readers should refer to the cautionary statement concerning forward-looking information that appears at the end of this news release.

To date, the Corporation has drilled and completed six Viking light oil horizontal wells at its Lucky Hills property. Four of these wells were on production through the month of August 2010. All four wells are currently flowing without the aid of pumping equipment. For the month of August 2010, estimated aggregate production from the four wells was 242 barrels of oil per day, or an average of 60 barrels of oil per day per well. Individual average well rates in August 2010 ranged from 41 barrels of oil per day to 94 barrels of oil per day. The last two wells were completed in late August 2010 and production testing is ongoing. Compass' corporate field production for the month of August 2010 is estimated to have been approximately 918 boe per day comprised of 64% crude oil and 36% natural gas.

The fiscal 2011 capital budget approved by the board of directors of the Corporation authorizes the drilling of nine additional Viking horizontal wells at Lucky Hills in the fall of 2010. This drilling program is currently scheduled to start in late September, subject to the timely receipt of well licenses from the Saskatchewan Ministry of Energy and Resources.

At the August 9, 2010 Saskatchewan Crown land sale, the Corporation was successful in acquiring 5.5 sections of undeveloped land in west central Saskatchewan, south of the Dodsland area. Compass believes these lands are prospective for future Viking light oil resource development.

Reader Advisories

Barrels of Oil Equivalent (boe). The term "boe" means barrel of oil equivalent, with natural gas converted to a crude oil equivalent at a ratio of six thousand cubic feet to one barrel. Boe's may be misleading, particularly if used in isolation. A boe conversion ratio of six Mcf (six thousand cubic feet) to one bbl (one barrel) is based on an energy equivalency conversion method primarily applicable at the burner tip and does not represent a value equivalency at the wellhead.

Caution - Forward-Looking Statements. This news release contains forward-looking information. All statements other than statements of present or historical fact or belief are forward-looking statements. Forward-looking statements are often, but not always, identified by the use of words such as "anticipate", "plan", "intend", "estimate", "expect", "may", "will", "should", or similar words suggesting future activities or outcomes. In particular, this news release contains forward-looking statements relating to the anticipated drilling of various Viking horizontal wells at Lucky Hills. Forward-looking statements are based upon the opinions and expectations of management of the Corporation as at the effective date of such statements and, in some cases, information supplied by third parties. Although the Corporation believes that the expectations reflected in such forward-looking statements are based upon reasonable assumptions and that information received from third parties is reliable, it can give no assurance that those expectations will prove to have been correct. Forward-looking statements are subject to certain risks and uncertainties that could cause actual events or outcomes to differ materially from those anticipated or implied by such forward-looking statements. These factors include, but are not limited to, such things as changes in general economic conditions in Canada, the United States and elsewhere, changes in operating conditions (including as a result of weather patterns), the volatility of prices for oil and gas and other commodities, commodity supply and demand, fluctuations in currency and interest rates, inherent risks associated with the exploration and development of oil and gas properties (including mechanical problems), timing, results and costs of exploration and development activities, availability of financial resources or third-party financing, availability of equipment, materials and personnel and new laws and regulations (domestic and foreign). Accordingly, readers should not place undue reliance upon the forward-looking statements contained in this News Release and such forward-looking statements should not be interpreted or regarded as guarantees of future outcomes.

Forward-looking information respecting the anticipated drilling of Viking horizontal wells at Lucky Hills is based upon various assumptions and factors, including the results of horizontal wells drilled to date by the Corporation at Lucky Hills, the time required to drill and complete existing wells, the Corporation's experience with the drilling of other oil and gas wells, the availability of materials, equipment and personnel in a timely manner and on commercial terms acceptable to the Corporation, the ability to obtain all required regulatory approvals on a timely basis and on satisfactory terms, that the initial wells to be drilled in connection with the fall 2010 program will be capable of commercial production of hydrocarbons, and no new laws and regulations being enacted that would materially affect operations.

The forward-looking statements contained in this news release are made as of the date hereof and the Corporation does not undertake any obligation to update publicly or to revise any of the included forward-looking statements, except as required by applicable Canadian securities laws. The forward-looking statements contained herein are expressly qualified by this cautionary statement.

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.

Contact Information

  • Compass Petroleum Ltd.
    Yook L. Mah
    President and CEO
    (403) 261-1911
    Compass Petroleum Ltd.
    Graham Barnes
    (403) 261-1911