Incremental aims to triple production at its new Wyoming oil field
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Incremental Oil and Gas expects to triple production at its newly acquired Borie oilfield in the US State of Wyoming.
The oil producer (ASX:IOG) has already begun work on production enhancement after finalising the acquisition last week and seamlessly transitioning to a new field operator.
Incremental already had the necessary permits in place from its ownership and operation of the Silvertip Field, also located in Wyoming.
“We believe that with the drilling potential that’s available in the field, we should be able to increase production from 60 barrels a day to more than 200 barrels a day in the next 12 months,” chief executive John Whisler told Stockhead.
This would take Incremental’s overall production to more than 700 barrels of oil equivalent per day.
Incremental is aggressively reviewing all opportunities to enhance production from the optimisation of the existing infrastructure.
Management will assess a number of shut-in wells to determine if they can be brought back to production.
The company has already identified up to three new well locations in the Borie oilfield and intends to start drilling these wells in the second half of 2018. Work is also continuing on identifying other new wells.
Low cost potential
Incremental has a significant inventory of casing and surface equipment at the Silvertip Field that can be used in the drilling program that will assist in reducing capital expenditure.
To assist in identifying well locations and other potential development opportunities in the Borie oilfield, 2D seismic surveys are being acquired at low cost.
Incremental is also reviewing ways to lower electricity and propane costs and is considering installing a solar energy system to supplement the electricity demand that is taken from the local grid.
Analysis will also be carried out to determine whether current propane usage can be supplemented or replaced from potential in-field gas production.
Efficiency is key
Analysis is being carried out to determine the potential of initiating an enhanced oil recovery water flood system in the North Borie Field to increase production and reserves.
Incremental is reviewing all secondary and enhanced recovery options that could be implemented utilising existing shut-in wells to re-energise the reservoir and increase oil recovery.
There is currently an existing water flood system in the main Borie oilfield that could be improved through utilising modern technology and enhanced oil recovery systems to deliver an increase in oil production.
Road to greater opportunity
Having an operation in the prolific DJ Basin provides Incremental with a foothold in a premium location with respect to geology, and it will enhance the company’s potential to gain access to other opportunities in the region.
Incremental follows a strategy of buying oil production cheaper than it can be drilled, then optimises for greater upside, including drilling new wells to increase cash flow and profit.
“Incremental is pleased to have acquired an asset that we will be able to substantially value-add,” Mr Whisler said. “Work will begin immediately to implement the various strategies that have been outlined by the company.”
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