$2.5m investor support boosts Whitebark production at Wizard Lake
Strong interest from major shareholders has allowed Whitebark Energy to ramp up its capital raising to fund completion of the Rex-4 well from $2.2m to $2.5m.
This follows the company receiving further commitments for a further $245,000 for the placement priced at $0.15c per share, taking the total firm commitments up to $1.225m and a corresponding increase in the convertible note.
The additional placement commitments include a $50,000 investment by director Matthew White.
While the original raising was intended to bring Rex-4 into production, Whitebark Energy (ASX:WBE) will use the additional funds towards efficiency improvements for the broader Wizard Lake field.
This work is expected to significantly reduce costs and increase flow rates.
The company’s Rex-4 well achieved all its objectives including landing the entire lateral section in the Rex Sandstone reservoir and demonstrating oil saturation throughout the well bore.
Completion is expected to increase Wizard Lake production by about 300 barrels of oil and 1.4 million standard cubic feet of gas per day, which will nearly double its output to about 750 barrels per oil equivalent per day.
This is expected to deliver solid cash flow given the current West Texas Intermediate crude price of US$85.21 per barrel and Henry Hub natural gas price of US$7.84 per million British Thermal Units (or 1,000 cubic feet).
Ultimate recovery from the well is expected to hit about 155,000 barrels of oil and 1.3 billion cubic feet of gas.
Completion of Rex-4 will also fulfil the company’s farm-in agreement with TWP50 in Section 20, giving it 100% of future production from the well.
This article was developed in collaboration with Whitebark Energy, a Stockhead advertiser at the time of publishing.
This article does not constitute financial product advice. You should consider obtaining independent advice before making any financial decisions.