Halkirk / Provost - Viking Opportunity

Play Synopsis Viking Sand Profiles: Provost Area

Schematics

I:\CGY\Geodata\ArcGIS\Project\User\sp_projects\ML_13_0049_Royalty\ML_13_0049_Poster\ML_13_0049_Halkirk_Provost_Viking\ML_13_0049_Halkirk_Provost_Viking.mxd

Oil and gas is trapped in Viking aged fine grained deltaic to shoreface sands in the Provost area. These

fields, discovered in the 1950’s, have estimated oil in place of over 1.3 billion barrels and despite extensive

waterflooding have an estimated recovery factor of only 5%. Horizontal drilling and multistage hydraulic

fracturing has resulted in successful redevelopment of these pools in Saskatchewan and the method is

being extended into Alberta.

Fluid: Oil 34 degree API

Area: T32-1W4 to T43-16W4

Active Operators: Karve, Tamarack

Seismic: 2-D and 3-D data is available over part of the land base

Infrastructure: Gas and oil pipelines and facilities are present in the area

Land Base: Checkerboard leases are available in focus areas

Play Parameters: Zone Depth: 800-900 m

Reservoir

Lithology: Sandstone

Average Porosity: 20-26%

Average Permeability: 1-500 mD

Water Saturation: 38%

Multi-stage perf and frac completion with lateral lengths from 0.5 mi up to 1.0 mi (ERH) Waterflood upside

Economics Operators such as Karve and Tamarack continue to develop the Viking

play by moving to extended reach wells (ERH) to further improve econom-

ics. Lateral lengths of ¾ to 1 mile are becoming increasingly common as

a means to add further value by improving the EUR’s from 40 mboe to 95

mboe. ERH wells are also much more capital efficient with DCET costs

ranging from $800 M to $1 MM. As a result, Rates of Return have im-

proved markedly with numbers over 100% common, and associated pretax

NPV’s exceeding $0.8 - 1 MM.

Note: Economic Indicators sourced from publicly available Corporate re-

port data.

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