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KELOWNA, BC, Nov. 27, 2012 /CNW/ - Georox Resources Inc. ("Georox" or the "Corporation") (GXR:TSX-V; OF6A:FRA) is pleased to announce that a second horizontal well on its Coteau Lake, southeastern Saskatchewan prospect has spudded on November 23rd. Georox will pay 42.5% of the costs to earn 31.875% Working interest BPO and a 21.25% working interest APO. The contract depth for this well is approximately 1,975 m and the estimated cost to Georox to drill, complete and test is approximately $839,000.
Drilling this well follows the completion of the review of the original 3D seismic after analyzing the results of the first horizontal well 8-10 on this prospect. Five additional well locations have been identified on a preliminary basis. The next well is anticipated to be drilled before March 31st, 2013. Georox has 3,040 gross (682 net) acres of oil and gas mineral rights in the light-medium Mississippian oil Coteau Lake prospect.
Burkhard, Franz, Georox President, expressed satisfaction that the development of the Coteau Lake project will expand. Mr. Franz stated "We believe this is a great opportunity to drill and participate in a highly prospective, light/medium oil exploration play and develop a new core area for the Corporation".
On July 16th, 2012 Georox announced that the initial 8-10 Coteau Lake well (31.875% BPO, 21.25% APO) was completed and swab tested at an average rate of approximately 435 bopd of light oil and 30 bpd of water over a 7.5 hour period. The well has been equipped and formally tested and production rates have been limited to approximately 60 bopd due to high water cut of 60%. The Production is expected to remain at this level until the water disposal application is approved by the Energy Resources Conservation Board. After the water disposal well is activated it is planned to implement high volume lift production on the 8-10 well.
The Corporation has entered into an agreement for a credit facility with a Canadian chartered bank, secured against the Corporation's assets. The credit agreement provides for a $1.0 million dollar demand operating facility and a $500,000 demand acquisition facility, subject to the bank's prior review of the proposed acquisition prior to use. Georox currently expects to make use of its bank facility for further development of its existing properties.
Cautionary Statement:
Neither the TSX Venture Exchange nor its Regulation Service Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.
No stock exchange, securities commission or other regulatory authority has approved nor disapproved the information contained herein.
The swab test rate expressed above is for a 7.5 hour period, extrapolated to a 24 hour period for the relevant well. Any references in this press release to production/performance rates are useful in confirming the presence of hydrocarbons, however, such rates are not determinative of the rates at which such well will continue production and its decline thereafter or ultimate recoverable resources. While encouraging, readers are cautioned not to place reliance on such rate in calculating the production for the well or Corporation.
FORWARD-LOOKING STATEMENTS
This news release contains forward-looking statements relating to the future operations of the Corporation and other statements that are not historical facts. Forward-looking statements are often identified by terms such as "will", "may", "should", "anticipate", "expects" and similar expressions. All statements other than statements of historical fact, included in this release, including, without limitation, statements regarding future plans and objectives of the Corporation, are forward looking statements that involve risks and uncertainties. There can be no assurance that such statements will prove to be accurate and actual results and future events could differ materially from those anticipated in such statements. Important factors that could cause actual results to differ materially from the Corporation's expectations are exploration risks detailed from time to time in the filings made by the Corporation with securities regulations.
The reader is cautioned that assumptions used in the preparation of any forward-looking information may prove to be incorrect. Events or circumstances may cause actual results to differ materially from those predicted, as a result of numerous known and unknown risks, uncertainties, and other factors, many of which are beyond the control of Georox. As a result, we cannot guarantee that any forward-looking statement will materialize and the reader is cautioned not to place undue reliance on any forward-looking information. Such information, although considered reasonable by management at the time of preparation, may prove to be incorrect and actual results may differ materially from those anticipated. Forward-looking statements contained in this news release are expressly qualified by this cautionary statement. The forward-looking statements contained in this news release are made as of the date of this news release, and Georox does not undertake any obligation to update publicly or to revise any of the included forward-looking statements, whether as a result of new information, future events or otherwise, except as expressly required by Canadian securities law.
SOURCE Georox Resources Inc.
