We're getting average around eighty five dollars Canadian and our op cost has been every
year we've been releasing. It was, like I said, it was sixty
dollars a barrow when we took sixty plus and we got it down to thirty
eight. Now we're getting down to thirty three. And these are additional wells
that's contributing to the fixed costs, so it's even lowering the costs. So
our netback is anywhere forty fifty dollars. The Financial Survival Network now more than
ever, the Financial Survival Network, And welcome. This is Financial Survival Network.
I'm your host, Carrie Lutz, and they've gotten a lot of requests
from you out there. Please please please give us an update on Prospero Energy.
Well, we're going to do better than that. We're going to talk
to the CEO, Samuel David. We're going to give you an update on
the drill program, the success to date five for five wells, increased production.
It's really a story of a turnaround that's coming to fruition with increased production
and the higher profits. Right around the corner, Saam, It's great to
see you again. Hey, So we're doing the horizontal wells. You've drilled
five of them, you're five for five. What are the results tangibly,
What can we look forward to in terms of increased production. Thank you for
reaching out for an update, and Prosperus is happy to convey what we have
encountered. As you mentioned, we have drilled five horizontals and infield drilling based
on geological delineation, well control and seismic delineation, and therefore the chance of
success of geological finding the reservoir is high. You know, the only a
risk is mechanical because this is infill low risk drilling, and that we tweaked
it by drilling couple of pilot wells prior to embarking on this development program.
That we have the drilled five wells. So as for all this tweaking,
these wells encountered pay structure and oil as we expected, and also we came
in under budget by about fifteen percent, and I think we can even tweak
that a little bit more as we extend the drilling. I'm going to share
a screen and show you the results that we have in the first few months
of productions. So here's the type curve that we used before embarking on the
development program for economics. And here are the results that we have encountered.
The production initial ips in the first two months, we have two months of
steady production effected was going up. And also there's a lot of room for
optimization on these wells because they're being held back. There's still twenty five joints
of fluid and the pump is just operating at a very low efficiency because we
don't want to exert high high draw do on on the reservoir. On the
heavy oil, with the heavier oil, with the higher viscosity, it is
important that you do not exert high drawed on on the reservoir. If you
do that, it's going to finger the water through the oil and you'll be
getting more water and then the oil. As you can see, we're drawing
these down at a very very low efficiency, and yet we're getting some really
good rates, exceeding our time curve expectations right see, producing more oil than
you expected. But obviously, from what you're saying, Sam, this is
a very delicate operation. You don't just march in there and start drilling wells
without knowing what you're doing. And this reservoir is very porous and permeable.
There's a lot of well control that we have. So we have placed the
technical team and the drilling team. They have worked together very well and placing
the well where we set out to do and then pass, encounter pay and
it is delivering at the initial stages, exceeding our expectations. Originally, the
plan called for ten wells to be drilled, and now you're upping that right.
Let me show you. Because of the results we have encountered and the
collaboration that we have with our services that we were working with, especially Lasso
Drilling Company, we have decided to extend our drilling program and continue drilling it
because we have our inventory of horizontals to drill and this whole field is being
transformed. Let me show you. Let me show you that I think a
picture success thousand words. Okay, this is one of the pools that we're
drilling. And when you're drilling these wells, these horizontals, we have to
shut in a lot of the adjacent production so that we don't encounter drilling issues
by the way of loss of mud, because if there's another well that's drying,
we're drilling here and we're pumping mud it will fly over to. Especially
in this premium porest Premiere reservoir. Most of the field is shut in prior
to two or three weeks prior to we start drilling, so the current production
is all there. We're attaining the results. As I showed you, the
last five wells that we drilled added an average one hundred barrels a day each
well. At initial stages. We expected decline later on, but it is
exceeding our expectations right now. So based on this, we're commencing drilling on
these well Actually we're going to commence drilling on this location and these wells.
Strategically we picked it out to set up other horizontals going further. So then
we have additional horizontals and you can see the whole reservoir is spaced and strategy
clean placed to optimize recovery, all recovery, not just a certain spot.
And with horizontals, you're reaching out and accessing additional pay is supposed to just
one vertical well like this, it only recovers around here. With these horizontals,
we're accessing the entire reservoir. It will deliver very nice, steady volumes
over time. And then if you notice there's a color scheme in here.
The red is the ones we're going to drill right now, and then we're
going to follow up with other wells. The blue ones are also we're going
to drill. The blue ones are going to be converted to injectors. You
know, we will start out as a producer and it will be converted to
injector so within the next year when the decline starts to come down, we
have already started in the reservoir management of providing energy and support, and that
will give us a better sweep efficiency and keep sweeping that oil to the producer
and at lower the decline. That means the company will have steady stream up
production, translate the cash flow. And you've got to feel good about this
because this field and what you're doing now is the reason you took on the
whole mess in the first place, right exactly. Not only when we drill
all of these we're abandoning out of these ridical lows that is there. So
we're reducing the environmental footprint and the associated surface lease costs, liability, and
the books or retirement obligation. It also lowers the liability and it leads to
a robust balance sheet r So basically there's a cleanup on Aisle seven. Here.
You're taking what was really not positive environment there, you're cleaning it up,
helping the environment, and you're producing energy barrels of oil which will directly
feed the bottom line and the plan to maintain low decline or reduce the decline.
So we have city stream up production. Right, So these wells are
probably going to outlast you and me. Serve life index of these reservoirs is
around forty years. It's just like I say, if I make it to
forty, well, I don't want to think about that. You know what
I'm saying. I did you and I have encountered a few times almost a
few times now. Yeah, So basically you've been vindicated, your plan,
your whole reason for doing this. You've proven it. I think it's going
in the direction as we anticipated the team. You know, what we have
encountered is what we anticipated, and I think your operation technique and brilling technique
is bang on, as you can see by the results. Right. Okay,
so now we go to the vertical wells at Brooks status update there.
Certainly, as we speak of, finally we got some of the permits and
licenses and you know, pipeline pipeline license, will license, and we're commencing
construction next week to set up for drilling. We already have the drilling rig.
We're still anticipating to meet dollar our targets for the year end. So
you had hit two wells last year and when you were drilling, but basically
they were just sitting there because you couldn't hook them in with the pipeline.
So you're going to be able to do that now, right. Those are
the pipeline permits that we have obtained, and we also have pained some leases
to drill and these are new lease and new pipeline, so you know,
they has to go through the whole process, and the process have become very
rigorous with all the environmental consideration that is going on. It's been about a
five month process that we've been encountering and finally we got some of them and
the others are coming on the way. So the first two wells, you
know, that's what really excited us. The first well test that one hundred
barrels a day flowing light oil. The other one tested at three hundred barrels
a day light oil. I mean that's an initial flush. Production will come
down, but it is a lot higher than what we anticipated, and we
have a fair way to run in this area. Out that we got three
D size make. We have just like what I showed you in the other
screen on the reservoir. We have delineated it with well controlled geology and size
make, and we have identified over twenty locations we get We do our best
to dull our eight eight wells or six sixty eight wells and tie including these
two tie in wells by the year at that's excellent news. And this is
medium uh medium medium medium light oil medium light. So now that's the equivalent
of like twenty four kind of no, it's still some discount. It's about
twenty four a bi okay, so pretty close, yeah, love SERTs.
So all right, so production you're foreseeing or forecasting in the near future fifteen
hundred and then it's going to go up fifteen hundred barrels per day equivalent,
and it's going to go up from there. Right, our urine target was
eighteen hundred and we still just obeit to hit that. Right in the first
five wills, like you said, are producing and drills on site, right
yes, we we drove them, completed them, tight them in fairly quickly.
And these additional program that these wells that are commencing as we speak right
now. You know, there's something release constructed and we're just moving on.
The rig is just moving on, and we're going to commence production next week
and we're going to do exactly what we just did. It's all going to
be what the shake cookie cutter, same same process for each well because they're
on the existing lease, there's already pipeline, tie it in and carry on.
Yeah, so so the opportunities there. Hey, I should mention that
I'm a shareholder, pretty significant shareholder from my perspective, from my finances,
and you know, I'm been waiting with bated breath for this interview, Sam,
because you know, the news is good, and obviously the market will
do what the market does, but at some point when they it's a story
of consistently increasing production from this point forward, barring weather conditions. And as
you mentioned market condition, you know, the the reserves are there and we
were executing them and we're going to continue doing that as arring from these conditions.
And like you said, you're running fifteen percent under budget, which is
like unheard of in the oil patch. Usually you're running fifteen to twenty five
percent above budget. I'm very happy to commit that and that it's it's a
credit to all those service providers, the technical team, you know, if
working efficiently and effectively, right, important And that means that you're out in
the field watching this, making sure that the money isn't flowing someplace else than
otherwise into the wellhead, right. You know, Western Canadians are happy to
have this kind of development happening and people are getting back to work and overall
it's good for a family and the society. Right. Hey, what's the
netback situation at this point? Netback of what we're getting for our oil.
Yeah, we're getting average around eighty five dollars canadian. I always talk.
I know you guys have a Canadian and our opp cost has been every year
we've been releasing. It was, like I said, it was sixty dollars
a barrow when we took sixty plus and we got it down to thirty eight.
Now we're getting down to thirty three. And these are additional that's contributing
to the fixed costs, so it's even lowering the cost so our netback is
anywhere forty fifty dollars, which is remarkable. And obviously the less you spend
developing these wells, then the higher the netback is going to be down the
road, of course. And also we're retiring another thirty six radical locations that
reduces our liability. And next summer we got a huge reclamation program to turn
all of this back to farming lands, reducing an environmental footprint that'll also reduce
tremendous amount to the bottom line to the op X. Do you anticipate picking
up the pace of drilling even more as the cash flow starts to mount up.
Well, sometimes you don't want to outrun the resources you have at hand.
And also you have to look at the reservoir management as well. There's
a lot of pre planning goes in here in order to do this. When
you rush these things, that's when you encounter additional capital costs because you went
a little too fast. We're maintaining a good pace, and you also have
to let the reservoir, you know, show us what it can do as
well. And there's also reservoir management. Perhaps we can go a little faster,
but then, like I said, you need to hire more people,
more teams, you know, all of complicated and then all of a sudden,
you know the process. If the process is good, perhaps a can
function, but a few the processes it always starts breaking down and the functionality
and the results starts interiorating. Interesting developments, all on the positive side,
which is great. I mean, how many companies out there can point to
revenues going higher and costs going lower. That in itself is a very rare
situation in this day and age, with inflation and the rapidly increasing prices on
so many things that we need every day. So that's great to see costs
h cost going down. And I guess we're going to have a lot more
to talk about in the not too distant future. So you want to go
over to cross Sperret energy dot com sign up for notifications so you'll know right
away for every barrel of production that that gets uh, that gets added,
which which is really what the story is about. And ticker symbols. In
Canada it's p e I, in the US it's g x R f F
he questions comments, you can always send me an email k l at Carrie
LUTs dot com. Sam, thanks for taking time out from the field.
Probably you're happy. I know it's cold there now, but I know that
your heart is always in the field. That's where the action is. The
financial survival network