Full-Year 2016 Gross Average Daily Partnership Production Increases 182% Year Over Year
TULSA, OK and VANCOUVER, BC, Feb. 2, 2017 – Jericho Oil Corporation (“Jericho”) (TSX-V: JCO; OTC: JROOF), a growth-oriented, upstream oil and gas company, is pleased to provide its Q1/Q2 2017 Operating Plan in Oklahoma, where it holds ~75,000 acres in partnership with a Private Family Office.
Jericho’s operating and technical team has begun its initial program aimed at reducing the decline rates within producing wells, returning idled wells to production and lessening downtime across its assets. A key portion of the Company’s acquisition thesis is that previous distressed operators have not provided the maintenance capital required to implement oil-field best practices and maintain production rates. Accordingly, the team’s effort has focused on arresting field-wide and specific well production declines through re-works, clean-outs, re-stimulations and pressure optimization on several horizontal and vertical wellbores.
In accordance with these efforts, the Company identified, multiple horizontal wells which were likely to be strong candidates for re-works due to the current lack of production contribution from many of the lateral stages. In late December, Jericho began its operating program returning a Woodford horizontal to production, as well as cleaning out and acidizing one Mississippian horizontal and one Hunton horizontal well. In the aggregate, positive results yielded incremental run-rate gross partnership production of approximately 65 BOE per day.
Minimal capital investments which provide strong, risk-adjusted returns on capital are Jericho’s main priority to increase production across its entire asset base. The Company has plans to re-work another 3-5 horizontal wells during the remainder of the First Quarter 2017.
In addition to Operating Improvements, Jericho is continuing to build out its full-year 2017 Capital Budget, which is expected to accelerate production growth with the drilling of de-risked, in-fill vertical and horizontal wells throughout its asset base primarily focused on the Hunton, Woodford and Mississippi Lime formations prevalent across its acreage.
In addition to the currently producing formations, the Company intends to test several other potentially productive formations including the Caney, Sycamore and Woodford formations which are all present throughout its Central Oklahoma lease hold.
2016 Production Growth
Full Year 2016 gross average daily partnership production rate of approximately 800 barrels of oil equivalent (BOE) per day reflects a 182% increase from Full Year 2015 gross average daily partnership production of approximately 285 BOE per day. Jericho holds a 38% Average Working Interest in the Oklahoma partnership.
Ryan Breen, Jericho’s Director of M&A and Corporate Development, stated, “The production increase is largely a testament to our acquisition-focused strategy to capitalize upon the historic oil price downturn over the last two years. As prices continue to moderate in an appropriate range, Jericho’s opportunities to realize the value of its asset base through de-risked drilling locations in addition to low-cost production improvements should deliver exceptional shareholder value in 2017.”
About Jericho Oil Corporation
Jericho is a growth-oriented oil and gas company engaged in the acquisition, exploration, development and production of overlooked and undervalued oil properties in the Mid-Continent. For more information, please visit www.jerichooil.com.
Cautionary Note Regarding Forward-Looking Statements: This news release includes certain “forward-looking statements” within the meaning of the United States Private Securities Litigation Reform Act of 1995 and Canadian securities laws. 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 events and results to differ materially from Jericho’s expectations include risks related to the exploration stage of Jericho’s project; market fluctuations in prices for securities of exploration stage companies; and uncertainties about the availability of additional financing.
Neither the TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.
Director, Investor Relations
Director, Corporate Communications