Yoho Resources Inc.
TSX VENTURE : YO

Yoho Resources Inc.

April 18, 2011 19:22 ET

Yoho Resources Inc. Provides Update on Duvernay Drilling and Completion Operations

CALGARY, ALBERTA--(Marketwire - April 18, 2011) -

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Yoho Resources Inc. (TSX VENTURE:YO) ("Yoho" or the "Company") is pleased to provide an update on its Duvernay drilling and completion operations.

Kaybob, Alberta

Yoho participated at a 33.33% working interest in the drilling and completion operations for the second horizontal well targeting the Devonian Duvernay shale formation under a previously announced joint venture with Celtic Exploration Ltd. and Trilogy Energy Corp., pursuant to which each partner currently has a one-third working interest in 30 gross sections of land.

The well (the "3-13 well") was drilled from a surface location at 16-14-60-20W5 to a bottom hole location at 03-13-060-20W5, with a total depth of 4,866 metres. The horizontal lateral was 1,391 metres in length within the Duvernay shale formation. The well was drilled and cased over 50 days at a cost of approximately $6.5 million for the drilling operation.

Completion operations began on March 8, 2011 and are expected to be concluded in late April. The 3-13 well was fracture stimulated in 31 perforated intervals in 12 separate stages along the length of the horizontal wellbore. In total, approximately 2,300 tonnes of sand and 138,600 barrels of slick water were used to stimulate the well. The well was completed using a staged "plug and perf" horizontal completion technique, incorporating perforation clusters (2 and 3 per stage) to stimulate the well. Following the fracture stimulation the plugs were drilled-out to permit the well to be evaluated without obstruction in the horizontal portion of the well. Production tubing and recorders will be run into the well following completion of the plug removal operation. Completion costs for this well, which was the first to use the "plug and perf" completion methodology in the Duvernay, have totaled approximately $11 million; however, Yoho expects to see substantial costs savings on subsequent wells targeting this formation.

The 3-13 well has been tied in since April 10, 2011 in order to reduce flared emissions during the completion and evaluation period. The well was flowing up 7 inch casing at approximately 1,250 Boe per day, consisting of 5.2 Mmcf per day of sweet natural gas and an estimated 390 barrels per day of natural gas liquids, including 180 barrels per day of free 56° API condensate and 1,450 barrels per day of completion water. Current production rates are expected to improve when production tubing is run into the well and additional water used to complete the well has been recovered. To date only 36,300 barrels (26 percent) of the completion water has been recovered. The sweet natural gas from the 3-13 well is liquids rich and is expected to yield total liquids of approximately 75 barrels per Mmcf of raw gas including free condensate (35 barrels per Mmcf).

Yoho is extremely encouraged by the results from the second horizontal Duvernay shale well and particularly the high liquids content given the current premium in pricing for natural gas liquids. Once completion operations are finalized, production tubing is run into the well and further production data is acquired, Yoho will review additional drilling locations with its partners. Yoho currently has working interests in 50.5 gross (17.7 net) sections of land with Duvernay rights in the Kaybob area along this liquids rich trend.

Cautionary Statements

Forward-looking information and statements

This news release contains certain forward–looking information and statements within the meaning of applicable securities laws. The use of any of the words "expect", "anticipate", "continue", "estimate", "may", "will", "project", "should", "believe", "schedule", "plans", "intends" and similar expressions are intended to identify forward-looking information or statements. In particular, but without limiting the forgoing, this news release contains forward-looking information and statements pertaining to the following: the estimated production volumes associated with the Duvernay well and the anticipated product mix; development and completion plans for the Duvernay well and land; expected cost savings on future operations.

In addition, forward-looking statements or information are based on a number of material factors, expectations or assumptions of Yoho which have been used to develop such statements and information but which may prove to be incorrect. Although Yoho believes that the expectations reflected in such forward-looking statements or information are reasonable, undue reliance should not be placed on forward-looking statements because Yoho can give no assurance that such expectations will prove to be correct. In addition to other factors and assumptions which may be identified herein, assumptions have been made regarding, among other things: the impact of increasing competition; the general stability of the economic and political environment in which Yoho operates; production rates after all completion activities, achieving future cost savings on drilling and completion operations based on operational experience and data, the timely receipt of any required regulatory approvals; the ability of Yoho to obtain qualified staff, equipment and services in a timely and cost efficient manner; drilling results; the ability of the operator of the projects in which Yoho has an interest in to operate the field in a safe, efficient and effective manner; the ability of Yoho to obtain financing on acceptable terms; field production rates and decline rates; the ability to replace and expand oil and natural gas reserves through acquisition, development and exploration; the timing and cost of pipeline, storage and facility construction and expansion and the ability of Yoho to secure adequate product transportation; future commodity prices; currency, exchange and interest rates; regulatory framework regarding royalties, taxes and environmental matters in the jurisdictions in which Yoho operates; and the ability of Yoho to successfully market its oil and natural gas products.

The forward-looking information and statements included in this news release are not guarantees of future performance and should not be unduly relied upon. Such information and statements; including the assumptions made in respect thereof, involve known and unknown risks, uncertainties and other factors that may cause actual results or events to defer materially from those anticipated in such forward-looking information or statements including, without limitation: changes in commodity prices; changes in the demand for or supply of Yoho's products; unanticipated operating results or production declines; changes in tax or environmental laws, royalty rates or other regulatory matters; changes in development plans of Yoho or by third party operators of Yoho's properties, increased debt levels or debt service requirements; inaccurate estimation of Yoho's oil and gas reserve and resource volumes; limited, unfavourable or a lack of access to capital markets; increased costs; a lack of inadequate insurance coverage; the impact of competitors; and certain other risks detailed from time-to-time in Yoho's public disclosure documents, (including, without limitation, those risks identified in this news release and Yoho's Annual Information Form).

The forward-looking information and statements contained in this news release speak only as of the date of this news release, and Yoho does not assume any obligation to publicly update or revise any of the included forward-looking statements or information, whether as a result of new information, future events or otherwise, except as may be required by applicable securities laws.

BOE equivalent

Barrel of oil equivalents or BOEs may be misleading, particularly if used in isolation. A BOE conversion ratio of 6 mcf: 1 bbl is based on an energy equivalency conversion method primarily applicable at the burner tip and does not represent a value equivalency at the wellhead.

Yoho Resources Inc. is a Calgary based junior oil and natural gas company with operations focusing in northeast British Columbia, West Central Alberta and the Peace River Arch of Alberta. The common shares of Yoho are listed on the TSX Venture Exchange under the symbol "YO".

This press release shall not constitute an offer to sell or a solicitation of an offer to buy the securities in any jurisdiction. The common shares of Yoho will not be and have not been registered under the United States Securities Act of 1933, as amended, and may not be offered or sold in the United States, or to a U.S. person, absent registration or applicable exemption therefrom.

Neither 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

  • Yoho Resources Inc.
    Wendy S. Woolsey, CA
    Vice President, Finance and CFO
    (403) 537-1771
    www.yohoresources.ca