Vandenberg & Hill

Victoria County, Texas

Pipeline Resources acquired a producing property in 1998, the Vandenberg & Hill lease. The lease is comprised of 995.85 acres and is located in Victoria County. When acquired, the property had three producing wells and the potential for recompletions of several shut-in wells. In addition, the property had a proven history of production from the East Placido Field, a prolific oil and gas field in the area. The East Placido Field has producing reservoirs in the Greta-Carancahua Strandplain System, which extends through Jackson, Refugio and southern Victoria counties. The East Placido Field produces from Miocene and Frio age sands trapped on a large anticlinal feature.

The field was discovered in 1937 and to date has produced over 13.6 million barrels of oil (MMBO) and 15 billion cubic feet (Bcf) of gas from over 40 individual oil and gas reservoirs found at depths between 3500' and 6900'. The Vandenberg & Hill lease is the single largest producing lease in the East Placido Field and to date has produced over 5.6 MMBO of oil and 7 Bcf of gas.

In the summer of 1998, Pipeline Resources participated in a 43 square mile 3-D seismic program in southern Victoria County which included the Vandenberg & Hill lease. The newly acquired seismic data interpretations, along with subsurface geology, indicated additional development of this lease was necessary. Expected reserve potential from future development drilling is 1 million BO and 3-5 Bcf of gas.

The Vandenberg-Hill project includes 17 wells including reworks, new wells and two converted to salt water disposal. Monthly production exceeds 2500 BO and 5000 Mcf.