Besides EOR Resources there are other players developing the Bakken oil resource. The economics are attractive in the Bakken play. At least four wells per section can be drilled. Drilling and completion costs are approximately $1.7 million per well, and according to our independent reserve evaluator, proved plus probable reserves are 100,000 barrels of oil per well, representing less than 10 percent recovery of original oil-in-place, are well below our internal estimates of well potential. This leaves considerable upside potential for improved recoveries.
Of the eight horizontal wells drilled in 2006 by Petrobank, seven were successful. The first four producers came on-stream at over 250 bopd and, in the first three months of production, have already produced more than 12,000 barrels per well. Each of these successful wells has yielded at least three follow-up development locations to be drilled through 2007.
So most wells are profitable after 6 months.
Petrobank’s Canadian Business Unit production now exceeds 17,000 boepd including more than 12,200 boepd of high netback, Bakken production. Petrobank now has an inventory of 540 net Bakken locations based on a drilling density of only four wells per section, and we plan to drill 154 of these locations in 2008, which we expect will make Petrobank the most active operator in the play.
At an average of 250 bopd for each of the locations, that would be 52,000 bopd by the end of 2008 and 147000 bopd by about 2010 for the current holdings from this one company. Some of wells have been coming in strong at 1000-2000 bopd.
Petrobank is also a leader in developing the THAI (Toe to heel air injection) oil sand recovery process. They are developing a 100,000 bpd site using THAI.