Reef Resources to Ramp Production at Ausable #5 Well

- Reef Resources to Ramp Production at Ausable #5 Well

Thursday, September 01, 2011
Reef Resources Ltd.

Reef Resources plans to install a hydraulic venturi downhole pump in the Ausable # 5 well. This proven oilfield technology, replacing conventional bottomhole pumps with venturi units, is currently being installed and tested on the Ausable #1 well. The hydraulic unit is designed to operate efficiently with the light oil and condensate currently being produced from the Ausable reef and will provide optimum production flow rates. It is anticipated that the hydraulic pumping units will also be installed in Ausable # 2 and Ausable # 4 over the course of the next two months.

Following the installation of the venturi pump in Ausable # 5 the Company will be in a position to accurately report production flow rate in addition to production potential with the previously announced Enhanced Oil Recovery (EOR) and cyclic natural gas liquids (NGL's) program. Under the EOR program, reservoir analysis and design work to date indicates re-pressurization of the reservoir will have a significant positive impact on overall field production and recovery factors. Results and updates of the Company's optimization program and implementation of the cyclic gas EOR program will be released once fully operational.

Reef also announced that two of the three frac tools from the Ausable #2 horizontal well have been successfully recovered. Approximately 75% of the productive zone is now open. Additional fishing operations are not viewed as cost effective and the Company will be moving forward with wellbore clean up and flow testing. A further announcement will be made once the well is on stream.

Arnie Hansen stated, "We continue to view Ausable # 5 very positively and the Company's engineering and operations team is working diligently to increase production by implementation of the venturi pumping system followed by the re-pressurization of the reef and commissioning of the EOR and NGL program. There are numerous analogous fields where these types of optimization efforts have successfully yielded significant increases in production once in operation."

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Reef Resources to Boost Production at Ausable Field

- Reef Resources to Boost Production at Ausable Field

Thursday, August 04, 2011
Reef Resources Ltd.

Reef Resources announced that significant progress is being made on determining the Ausable #5 future flow rate. The presence of very light oil, blended with natural gas condensates, creates foamy oil conditions and consequently the current mechanical bottom hole pumping configuration is operating at very low efficiency causing erratic flow rate and high fluid levels in the wellbore. The Ausable field has now been shut in for a period of time to provide fluid level and pressure build up data that is necessary to determine the Ausable #5 likely flow rate using industry accepted inflow analysis technique and will be reported as soon as all data is processed.

When the likely ultimate flow rate has been estimated Reef will be able to design and execute a plan for long term lifting of the well fluids using revised pumping techniques that will allow the full potential of the well to be realised.

The removal of the frac tools from Ausable # 2 is also progressing. The first stage of tubing cuts have been successfully executed and will now concentrate on extracting the frac tools over the course of the next few days. Once the frac tools are removed the Company will report on the status of Ausable #2.

Arnie Hansen stated, "While still at a preliminary state, Ausable # 5 is looking very positive and the Company's engineering team is working on a solution to increase pumping efficiencies therefore increasing production. This is the first stage of optimization with next goal to acquire and inject natural gas to re-pressure the reef that will significantly increase production and demonstrate the true value of the Ausable pool."

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Reef Resources to Test Flows at Ausable Well

Reef Resources to Test Flows at Ausable Well

Tuesday, April 19, 2011
Reef Resources Ltd.

Reef Resources has agreed to complete and flow test the Ausable #5 well in SW Ontario, Canada.

A decision has been made to mechanically complete the well and to conduct flow tests on the basis of the existing data. Further analysis of electric logs and cores from the wells will continue.

Following production testing; the well will be connected to the existing central production facility and placed on production as an oil and natural gas liquids (NGL) producer. The Company's objective is to have the well on production within the next four to six weeks.

Due to the presence of extensive oil and natural gas liquids pay zones in the Ausable #5 well, the Company will now begin detailed scheduling for the drilling of the Ausable #6, #7, #8 and #9 wells and the expansion of the Ausable production facility. Currently it is hoped to complete this additional work by the end of 2011.

The Company will issue additional status reports during the testing and completion of Ausable #5 and as plans for the full Enhanced Oil Recovery and Natural Gas Liquids Program (EOR) are finalized. The Ausable reef is currently on production and is generating revenue from the initial EOR program which commenced in 4th quarter 2010 through the Ausable #1 and #4 wells.

Company President, Arnie Hansen, commented, "We see this as a turning point in the development of the Ausable Reef as the results of the well fully support our geological model and demonstrate the viability of the EOR scheme. We look forward to a busy period over the remainder of the year as we plan and execute the necessary well program."

Reef Resources Encounters Oil Pay at Ontario Well

Reef Resources Encounters Oil Pay at Ontario Well

Wednesday, April 13, 2011
Solo Oil plc

Reef Resources reported that petrophysical analysis has been finalized on its Ausable #5 well. Log analysis indicates 72 meters net pay of oil, natural gas liquids (NGL's) and natural gas in the Guelph and A2 formations in Ontario, Canada.

Log analysis in the Guelph indicates net oil and gas liquids pay zone is 57 meters with porosity averaging 9.7%. Evidence of hydrocarbons was evident on core and logs throughout the Guelph formation.

Additionally, the shallower A2 formation was identified as a potential gas producer with net pay of 15 meters and 7% porosity.

The Company will now undertake a work program in order to complete the hole and flow test the well, with the intent of bringing the Ausable #5 well on production.

A comprehensive core analysis will be conducted in the near future to determine cap rock integrity for future gas storage, permeability of the producing zones and provide useful information for the upcoming completion program.

Arnie Hansen, President, stated, "The Ausable #5 well has exceeded our expectations. The log and core results confirm the notion the Ausable reef is an underutilized and undervalued asset. Findings on the Ausable #5 well confirm the Company logic to accelerate the Enhanced Oil Recovery (EOR) and Natural Gas Liquids program."

Reef will be announcing test results after completion and next development steps in the EOR, NGL program.

The Ausable reef is currently on production and is generating revenue from the initial Enhanced Oil Recovery Natural Gas Liquids Recycling program which commenced in 4th quarter 2010.

Solo Executive Director, Neil Ritson, commented, "These results, with over 70 metres of net hydrocarbon pay, are extremely encouraging and the Ausable #5 well has a high probability of being productive. This result contributes significantly to the field development plan and to the knowledge necessary to successfully optimize the EOR scheme. The well, financed by Solo's participating loan, adds further encouragement that the EOR scheme will be commercially successful."

Reef Reaches TD at Ausable Well

Reef Reaches TD at Ausable Well

Thursday, March 31, 2011
Reef Resources Ltd.

Reef Resources reported that drilling of its Ausable # 5 well reached total depth of 615 meters on March 29. A total of 4 cores were taken over a depth of 32 meters with overall good recoveries. Oil staining was observed on the core sample which is currently being analyzed with results to be released in the near future. Data from the core samples will provide information on cap rock integrity and will be utilized, in addition to existing 3D seismic data, to pinpoint further drilling targets for future horizontal wells in the Ausable pinnacle reef.

The Ausable # 5 wellbore is being logged to identify the intersected hydrocarbon zones in the Ausable reef at this location. Results will be analyzed and released as soon as it is available.

The Ausable reef is currently on production and is generating revenue from the initial Enhanced Oil Recovery Natural Gas Recycling program which commenced in 4th quarter 2010.

Executive Director of Solo, Neil Ritson commented, "The presence of oil on the cores is considerable encouragement that we will be able to commercially produce this well while we awaiting the further planned development of the EOR scheme by Reef later this year."