TIDMHNR
RNS Number : 8862M
Highlands Natural Resources PLC
19 October 2016
This announcement contains inside information
19 October 2016
Highlands Natural Resources plc ('Highlands' or 'the
Company')
DT Ultravert Testing Update
Highlands Natural Resources, the London-listed natural resources
company, is pleased to announce that it has concluded its
preliminary analysis on data collected over a three week period
following the completion of recent testing campaigns for DT
Ultravert in the Piceance Basin, Colorado. This analysis suggests a
successful initial demonstration of DT Ultravert as a solution for
both protecting existing wells (known as 'parent wells') from
damage caused by a new threat that has emerged to the industry,
known as 'bashing', and enhancing well productivity by facilitating
the re-fracking of horizontal wells. Testing of DT Ultravert
commenced in September 2016 in cooperation with Laramie Energy
('Laramie'), Schlumberger Limited ('Schlumberger') and Calfrac Well
Services Corp. ('Calfrac').
Highlights:
-- No reduction observed in the original decline curve in either
parent well, indicating that 'bashing' has been successfully
avoided
-- Desired pressure build-up achieved in both parent wells
treated with DT Ultravert, a critical element of a successful
diversion process
-- Overall, the technical results suggest a successful initial
demonstration of DT Ultravert in parent well protection and child
well enhancement applications
VP of Engineering Domingo Mata said, "The positive initial
results from our first test of DT Ultravert represent an important
milestone for Highlands and all stakeholders in this technology.
These initial tests answer three key questions: Firstly, that DT
Ultravert can achieve significant and sustained down-hole pressure
that effectively diverts fluids from depleted areas of the
reservoir. Secondly, that DT Ultravert can prevent well bashing.
Thirdly, that the application of DT Ultravert can enhance the
stimulation of child wells and improve production performance. We
believe that the success of this testing and the preliminary
conclusions outlined here will boost our ongoing commercialisation
efforts for DT Ultravert. We look forward to updating the market
with additional data and commercial progress related to DT
Ultravert in due course."
Testing Initiatives
On 22 September, 2016, Highlands completed its first test of DT
Ultravert in two natural gas wells operated by Laramie Energy
("Laramie") in the Piceance Basin, Colorado. Nitrogen was injected
into two parent wells prior to and during fracking operations in
neighbouring child wells. Highlands employed a proprietary and
patent-pending injection methodology in this trial. Wells in this
basin are commonly drilled in close proximity (as dense as one well
per ten acres), and bashing has become a concern in the infilling
of leased acreage.
Highlands has received and analysed data from Laramie covering a
period of approximately three weeks from injection. After assessing
the data, Highlands believes that these initial tests were
successful, demonstrating parent well protection and productivity
enhancement in child wells. In addition, the data obtained also
provides essential information for future calibration, optimisation
and commercialisation of the DT Ultravert technology.
Initial Conclusions
Building Pressure to Achieve Diversion
The use of DT Ultravert achieved the desired pressure build-up
in both parent wells treated before and during fracking operations
in nearby child wells. Specifically, DT Ultravert achieved
post-injection (overnight) pressure increase of 45% in one well
over a five-day period. Sustained overnight pressure increase in
the second well reached 47%. Peak pressures (during daytime
nitrogen injection) reached more than 2,000 psi in both wells, an
increase of 103% compared to the initial well pressure.
The Company believes that these initial results confirm the
potential for DT Ultravert to achieve and sustain significant
pressure uplift in previously fractured wells. Furthermore,
elevated pressures remained even after injection operations ceased
at nightfall each day. Boosted pressures enable fluid diversion,
which is a critical component of both parent well protection and
re-fracking applications for DT Ultravert.
Productivity Enhancement in Child Wells
After 24 days of production, the two child wells showed daily
gas production rates that are in line with Laramie's nearby wells
completed in "virgin" undepleted rock. These results suggests that
DT Ultravert treatment in parent wells succeeded in forcing child
well fracture fluids to flow away from depleted regions of the
parent wells and instead to fracture new rock with greater reserves
and production potential. Highlands believes that this outcome has
important positive implications for the economics of child wells
drilled in conjunction with parent wells protected by DT
Ultravert.
Preventing Bashing on Parent Wells
Both parent wells treated with DT Ultravert sustained no loss in
production or "bashing" from child well fracking. This result
compares favourably to nearby wells where bashing was observed as a
result of offset child well fracturing operations. As mentioned
before, both protected parent wells demonstrated natural gas
production rates returning to the original decline trajectories,
indicating that DT Ultravert successfully protected the parent
wells, a primary objective of the technology test.
In addition, both parent wells protected by DT Ultravert resumed
pipeline sales after only five days, demonstrating that the
injection of nitrogen did not cause a long-term disturbance in the
gathering and sales operations of produced gas.
**ENDS**
For further information, please visit www.highlandsnr.com, or
contact:
Highlands Natural +1 (0) 303 322
Robert Price Resources plc 1066
Cenkos Securities +44 (0) 131 220
Nick Tulloch plc 9772
+44 (0) 131 220
9771 /
Cenkos Securities +44 (0) 207 397
Neil McDonald plc 1953
St Brides Partners +44 (0) 20 7236
Lottie Brocklehurst Ltd 1177
St Brides Partners +44 (0) 20 7236
Elisabeth Cowell Ltd 1177
Notes to Editors
Highlands Natural Resources (LSE: HNR.L) is a London-listed
natural resources company with a portfolio of high-potential oil,
gas and helium assets and technologies. The company's core projects
include:
-- DT Ultravert: a re-fracking and parent well protection
technology with 20 patents pending in the United States and
internationally. Highlands is advancing commercial conversations
with a range of oil and gas operators to create revenue-sharing
opportunities for DT Ultravert applications.
-- Helios Two: a 100,000+ acre helium and natural gas prospect
in SE Montana with drilling and assessment operations ongoing.
-- East Denver Niobrara: a farm-in opportunity for six
horizontal oil and gas wells targeting the Niobrara shale formation
in a well-studied area of the Denver Julesburg Basin.
This information is provided by RNS
The company news service from the London Stock Exchange
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