Vulcan Minerals Inc.

Vulcan Minerals Inc.

December 08, 2010 11:17 ET

Vulcan Minerals Inc.-Finnegan #1 Encounters Natural Gas

Year End Operational Update-Western Newfoundland

ST.JOHN'S, NEWFOUNDLAND and LABRADOR--(Marketwire - Dec. 8, 2010) - Vulcan Minerals Inc. ("the Company") (TSX VENTURE:VUL) is pleased to provide the following update on its operations in western Newfoundland.


The Company has been advised by the operator, Nalcor Energy Oil and Gas (Nalcor) that Finnegan #1 has reached a total final depth of 3130 metres. The well encountered natural gas and is suspended pending further evaluation including a potential test program. Finnegan was drilled on exploration permit 03-102 and is the second of a proposed three well program in the Parsons Pond area of western Newfoundland. The well is a wildcat test drilled in an area known historically for numerous oil seeps at surface and in shallow wellbores within the Cambrian Ordovician-Anticosti basin. 

Following release of the service rig from Vulcan's Bay St George completion operations, it was mobilized by Nalcor to the Seamus #1 well site at Parsons Pond. Nalcor advises that flow testing of the Seamus well will commence shortly. Seamus was drilled earlier this year on exploration permit 03-103 and was suspended pending a test program for natural gas.

Nalcor, as operator, also advises the Company that it is preparing to drill the third program well, Darcy #1 (exploration permit 03-102) with an early 2011 commencement date.

The Company owns a 10% working interest in exploration permit 03-103 and a 7.3% working interest in permit 03-102.


Completions Program:

The Company has successfully completed injectivity testing on the Robinsons #1 and Red Brook #2 wells. These test results will provide the necessary parameters to design the optimal hydraulic fracture stimulation of the zones previously perforated and pressure tested. Based on the results of this Phase I completion program the company expects to carry out a stimulation program to adequately test the flow rates of the prioritized zones as soon as equipment is available in the area to carry out the operations. The earliest that the Company expects access to frac equipment in the area is in the spring of 2011 when equipment may be available during spring break up in western Canada. The completion program is the culmination of a wildcat drilling program in the Bay St. George basin of western Newfoundland. The results, combined with additional delineation drilling will provide the necessary information to support a natural gas resource and reserve assessment for the area.

Seismic Program:

The Company has successfully completed one of the largest seismic programs ever acquired in the onshore area of western Newfoundland. Approximately 130 line kilometres of data have been recorded and are currently being processed. The new data will be important in delineating the Jockey structure south of Red Brook and Robinsons as well as refining several drilling leads in other parts of the basin. The data will be processed and interpreted as soon as possible to finalize additional drill targets for 2011.

Geochemical Survey:

The Company recently engaged W.L. Gore & Associates Inc., the inventors of GORE-TEX fabrics, to carry out a GORE Amplified Geochemical Imaging Survey over the Bay St. George project area. The field operations of this survey have been successfully completed. The survey entailed placing small, retrievable modules in the soil which measure and map hydrocarbon compounds emanating from depth. The data will assist in drill target prioritization, seismic and structural interpretation of the Bay St. George basin. The technique has been used in over 130 sedimentary basins in more than 56 countries worldwide. It is a cost effective exploration tool which will assist with the mapping of the 250,000 acre exploration area including the Flat Bay oil deposit. The field data are currently being analysed and processed by GORE. Final interpretable results are expected in 60-80 days.

All current operations in the Bay St. George basin are being carried out pursuant to a 50/50 joint venture with Investcan Energy Corporation.

Commenting on the Company's activities the President said, "This past year has been one of our busiest years in terms of the volume and diversity of the field operations carried out. We participated in projects with gross budgets of approximately $33 million dollars of which only $5 million was a net cost to Vulcan. This represents excellent leverage on several exploration fronts that included a net 30% participation in an offshore Labrador seismic program. We look forward to a continued busy year in 2011 with flow testing of our gas discoveries in the Bay St. George basin and further drilling."

Vulcan is a diversified junior exploration company focused on petroleum exploration in the under-explored western Newfoundland and Labrador areas and also holds mineral interests in areas strategic to its operations in Newfoundland and Labrador.

The TSX Venture Exchange has not reviewed and does not accept responsibility for the adequacy or accuracy of this release. The statements made in this News Release may contain certain forward-looking statements. Actual events or results may differ from the Company's expectations. Certain risk factors may also affect the actual results achieved by the Company.

There can be no assurance that forward-looking information will prove to be accurate. Should one or more of these risks and uncertainties materialize, or should underlying assumptions prove incorrect, actual results may vary materially from any conclusions, forecasts or projections described in the forward-looking information. Accordingly, readers are advised not to place undue reliance on forward-looking information. Except as required under applicable securities legislation, the Company undertakes no obligation to publicly update or revise forward-looking information, whether as a result of new information, future events or otherwise.

Shares Issued: 54,461,241

Contact Information