High North Resources Ltd.

High North Resources Ltd.

June 23, 2014 09:00 ET

High North Resources: Drilling Program Update


High North Resources Ltd. (TSX VENTURE:HN) (the "Company" or "High North") is pleased to provide an operational update on its drilling program. The Company's fourth well, 08-21-076-21W5M, located on the northern portion of the Company's Girouxville-Mclean property, has been drilled and stimulated and is derisking five sections of land which Management anticipates will provide 20 to 24 horizontal drilling locations. The drill location of this fourth well is adjacent to a section of land on which another oil and gas producer has applied to drill four Montney oil horizontal wells. The 08-21 well produced hydrocarbons from the Montney formation during the production test and is currently shut-in for a pressure build-up test as required by government regulations.

The Company's fifth well, located at 08-02-076-21W5M, was drilled in the Montney formation and is scheduled to commence completion this week. This well directly offsets a competitor's Montney oil well which reported a 30-day initial production rate of 360 barrels of oil per day and cumulatively produced 33,000 barrels of oil during its first six months, indicating a potential payout in one year using a netback of $50.00 per barrel of oil.

The Company's first two wells, 16-2-76-21W5M and 9-2-76-21W5M, continue to flow oil at approximately 240 barrels per day at wellhead pressures above 870 psia through restricted, undersized, rental surface facilities. Management believes that the high pressures are indicative of the capability of increased production rates. Installation of permanent facilities is expected in July, 2014. The Alberta Energy Regulator (the "AER") is permitting production until end of April, 2015, subject to flaring volume constraints while the Company proceeds toward the installation of facilities in order to conserve and produce NGLs from the associated gas. The Company's third well, 9-26-76-21W5M is shut-in temporarily due to weather-related transportation delays of produced fluid. The Company is planning to alleviate this situation shortly. Additionally, the Company's project development drilling plan for its 20 contiguous sections has been submitted to the AER and is currently under review.

High North's Girouxville-Mclean property is located in Townships 075 to 076, Range 21 W5M, approximately 200 miles northwest of Edmonton, Alberta. The Company holds a 100 percent working interest in the three horizontal wells described above producing 30 degree API oil from the Montney Formation. High North holds a contiguous block of lands comprising 20.25 sections, with current drilling directly offsetting significant production from an adjacent oil and gas producer.

In the Girouxville-McLean area, the Company has earned 100 percent working interest in 38.25 sections of land with prospective Montney rights through acquisitions of Crown land and wells drilled to date. The Company intends to drill a minimum of four horizontal wells per section targeting Montney oil on these prospective lands. The Company can also earn an additional 134.75 sections of Montney rights through future drilling commitments.

Reader Advisory Regarding Forward-Looking Statements

This news release contains certain "forward-looking statements" or "forward-looking information" (collectively referred to herein as "forward-looking statements") within the meaning of applicable securities legislation. Such forward-looking statements include, without limitation, forecasts, estimates, expectations and objectives for future operations that are subject to a number of assumptions, risks and uncertainties, many of which are beyond the control of the Company. Forward-looking statements are statements that are not historical facts and are generally, but not always, identified by the words "expects", "plans", "anticipates", "believes", "intends", "estimates", "projects", "potential" and similar expressions, or that events or conditions "will", "would", "may", "could" or "should" occur or be achieved. This news release contains forward-looking statements, pertaining to, among other things, the following: drilling locations and the number of wells the Company is considering drilling, timing for the drilling and completion of certain wells and the installation of permanent facilities, the capability of increased production, and potential payout amounts. Statements regarding future production, capital expenditures and development plans are subject to all of the risks and uncertainties normally incident to the exploration for and development and production of oil and gas that may cause actual results or events to differ materially from those anticipated in such forward-looking statements. These risks include, but are not limited to, inflation or lack of availability of goods and services, environmental risks, drilling risks, regulatory changes and certain other known and unknown risks detailed from time to time in High North's public disclosure documents, copies of which are available on High North's SEDAR profile at www.sedar.com.

Although High North believes that the material factors, expectations and assumptions expressed in such forward-looking statements are reasonable based on information available to it on the date such statements were made, no assurances can be given as to future results, levels of activity and achievements and such statements are not guarantees of future performance. High North's actual results may differ materially from those expressed or implied in forward-looking statements and readers should not place undue importance or reliance on the forward-looking statements. Statements including forward-looking statements are made as of the date they are given and except as required by applicable securities laws, High North disclaims any intention or obligation to publically update or revise any forward-looking statements, whether as a result of new information, future events or otherwise. The forward-looking statements contained in this news release 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.

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