Corridor Resources Inc.

Corridor Resources Inc.

December 06, 2010 07:45 ET

Corridor Updates Elgin Shale Gas Appraisal Program

HALIFAX, NOVA SCOTIA--(Marketwire - Dec. 6, 2010) - Corridor Resources Inc. (TSX:CDH) announced today the following update on the shale gas appraisal program in the Elgin area of southern New Brunswick.

Apache Canada, the operator pursuant to a joint venture program with Corridor, completed the drilling and casing of the Green Road B-41 and the Will DeMille G-59 horizontal wells in the second and third quarters of 2010, respectively. Strong gas shows were encountered in the horizontal section of both wells during drilling. These gas shows occurred while using high mud weights averaging 1350 kg/m3 on the Green Road B-41 well and averaging 1450 kg/m3 on the Will DeMille G-59 well.

Five slickwater fracture stimulation procedures were completed in each of the wells with the fracs averaging 230 tonnes of propant and 3560 cubic meters of water. The final frac in the "silty interval" of the Green Road B-41 horizontal well is approximately 630 meters from the silty interval of the Green Road G-41 vertical well drilled by Corridor in 2009. That interval in the vertical G-41 well was fraced with propane in 2009 and produced 42.4 mmscf over 185 hours, peaking at 11.7 mmscf/d with a final rate of 3.0 mmscf/d at ~ 700 psi.

After the plugs were drilled out in both horizontal wells, the B-41 well has recovered 1728 cubic meters of frac fluid (~ 10 percent of total) and no gas to date and the G-59 well has recovered 805 cubic meters of frac fluid (~ 4 percent of total) and negligible gas to date. Frac water recovery rates have declined significantly from both wells. Steps are being undertaken to recover additional amounts of frac water which could encourage the flow of gas into the wellbore.

Considering the strong gas flows from Corridor's nearby G-41 vertical well, and the strong gas shows encountered while drilling the two horizontal wells, the preliminary responses of these wells are both unexpected and perplexing. The operator is reviewing the frac operations and flowback data and is conducting extensive analysis and further testing in order to determine why the wells have responded in this manner, and to develop a go-forward approach in order to advance the Elgin shale gas appraisal program. Although the well response to date is perplexing, it is important to recognize that the evaluation of the development potential of the Elgin shale gas resource play is in its early stages.

Corridor also reports that Apache and Corridor have agreed to conduct tests on the South Branch G-36 oil well.

Corridor is a junior resource company engaged in the exploration for and development and production of petroleum and natural gas onshore in New Brunswick, Prince Edward Island and Québec and offshore in the Gulf of St. Lawrence. Corridor currently has reserves of natural gas at the McCully Field near Sussex, New Brunswick and shale gas resources in the adjacent Elgin sub-basin. In December 2009, Corridor entered a joint venture to appraise and potentially develop its significant shale gas resources in the Elgin area.

Forward Looking Statements

This press release contains certain forward-looking statements and forward-looking information (collectively referred to herein as "forward-looking statements") within the meaning of Canadian securities laws. All statements other than statements of historical fact are forward-looking statements. Forward-looking information typically contains statements with words such as "anticipate", "believe", "plan", "continuous", "estimate", "expect", "may", "will", "project", "should", or similar words suggesting future outcomes. In particular, this press release contains forward-looking statements pertaining to the following; steps to recover additional amounts of frac water, and future tests and evaluations to be conducted of the wells.

Undue reliance should not be placed on forward-looking statements, which are inherently uncertain, are based on estimates and assumptions, and are subject to known and unknown risks and uncertainties (both general and specific) that contribute to the possibility that the future events or circumstances contemplated by the forward-looking statements will not occur. These factors include, but are not limited to: risks associated with oil and gas exploration, financial risks, substantial capital requirements, bank financing, government regulation, environmental, prices, markets and marketing, issuance of debt, variations in exchange rates and hedging. Further information regarding these factors may be found under the heading "Risk Factors" in Corridor's annual information form for the year ended December 31, 2009 and its most recent management's discussion and analysis. Readers are cautioned that the foregoing list of factors that may affect future results is not exhaustive. There can be no assurance that the plans, intentions or expectations upon which forward-looking statements are based will in fact be realized. Actual results will differ, and the difference may be material and adverse to Corridor and its shareholders. 

Forward-looking statements are based on Corridor's current beliefs as well as assumptions made by, and information currently available to, Corridor concerning anticipated financial performance, business prospects, strategies, regulatory developments, future natural gas and oil commodity prices, exchange rates, future natural gas production levels, the ability to obtain equipment in a timely manner to carry out development activities, the ability to market natural gas successfully to current and new customers, the impact of increasing competition, the ability to obtain financing on acceptable terms, and the ability to add production and reserves through development and exploration activities in addition to the provisions of the farm-out and option agreement between Apache and Corridor. Although management considers these assumptions to be reasonable based on information currently available to it, they may prove to be incorrect. The forward-looking statements contained in this press release are made as of the date hereof and Corridor does not undertake any obligation to update publicly or to revise any of the included forward-looking statements, except as required by applicable law. The forward-looking statements contained herein are made as at the date hereof and are expressly qualified by this cautionary statement.

Contact Information

  • Corridor Resources Inc.
    Phillip Knoll
    902-429-0209 (FAX)