Daboval Field Prospect

Wharton County

Pipeline Resources, Inc. recently acquired a producing property in the Daboval Field in Wharton County, Texas. The Daboval Field is located within a portion of the Frio Trend characterized by prolific oil and gas production from highly porous and permeable sands that serve as excellent quality reservoirs. The field, although fairly small, has produced more than 660,000 barrels of oil (BO) and 14.5 billion cubic feet (Bcf) of gas from over 25 separate reservoirs within the Frio section, ranging in depth from about 5400 to 7200 ft.

The 160 acre Daboval lease was held by production by the #A-3 Daboval, currently producing approximately 7 BO and 300 barrels of water per day. Existing production facilities include a disposal well for the produced water and seven inactive wellbores. Although multiple recompletion opportunities exist in these wells, the initial primary focus of the project is to drill an infield development well on the lease.

The trapping mechanism for the Daboval Field is a small anticlinal feature the crest of which is located on the Daboval lease. Subsurface mapping on the various producing horizons indicates the actual apex of the feature has not been drilled. Based on this mapping, beginning 1 November 2008, a test well, the Daboval A-8, was drilled to 7400’ expecting to encounter many of the productive zones structurally high to the surrounding wells. The possibility also existed some combination of new reservoirs not encountered previously, thin zones bypassed by previous operators, or pressure depletion reservoirs incompletely drained might also be present.

Drillers reached total depth on 13 November 2008 and discovered an astounding 37 potentially productive sands. The well was subsequently completed and turned on in January, 2009, at an initial flow rate of 220 barrels of oil per day (BOPD) and 50 thousand cubic feet per day (McfPD) of natural gas.

Extensive work has been accomplished to repair and upgrade existing equipment on this property, particularly the saltwater disposal wellbore, the A-6. Additional work included replacing pumpjacks with more efficient gas lift valves. A re-work on a pre-existing wellbore, the A-3, was completed in May 2009; that same month Pipeline Resources drilled another new well, the Daboval A-9. The A-9 tested productive in 27 zones, including some seen in the A-8 as well as new zones not seen in the surrounding wellbores. The first three completions in the A-9 were unsuccessful; however, the fourth, in a gas sand at 5556-61' came on at 1179 McfPD and is continuing to produce at nearly a million cubic feet daily. Monthly production is over 600 BO and over 20 million cubic feet (MMcf) of gas.

Data gathered in the evaluation of these wells will also be useful in further delineating the potential of multiple recompletion opportunities identified in the inactive wellbores. No new wells are currently planned for the lease. Remaining reserve potential is estimated to be 100,000 BO and 2.2 Bcf of gas.