Alberta – Ellerslie Gas Production
Viking Oil Production
In August 2008, Jadela entered into a farm-in agreement for lands located in the Crossfield, Alberta area to tie in an existing gas well located at 10-29-030-03W5. The pipeline tie-in project was completed in early April 2009 and the well commenced production from the Ellerslie on April 9, 2009.
Jadela has a 35% working interest in the well, subject to a 12.5% lessor’s royalty and 6% farmor royalty. Production from this well represents the majority of the Jadela’s production. Jadela’s 35% working interest in such well includes all rights from the base of the Cardium zone to the base of the Manville zone, including the petroleum and natural gas rights in the Viking zone.
In November 2010, Jadela entered into a farmout agreement with another industry partner (“WLE”) to develop Jadela’s 35% working interest in the Viking formation. Under the terms of such farmout agreement, WLE was to have paid 100% of Jadela’s capital obligations to drill and complete the well in exchange will earn 60% of Jadela’s 35% working interest. Well site preparations were made. The well was not drilled because WLE did not contribute funds upon being ach called.
In November 2011, Jadela elected to participate in the drilling of a 3,500 foot lateral well into the Viking formation completed with open hole propane frac fluid and the services of GasFrac Energy Services Inc. In December 2011, Jadela farmed out its working interest to a different industry partner (“AEL”). AEL drilled and completed the well by April 3, 2012.
In November 2006, Jadela entered into a farm-in arrangement for interests located in the Wapiti area to drill a Dunvegan test well (01-22-065-08W6) which was completed and placed on stream. Jadela participated in the drilling of the well and earned a 9.75% working interest therein. In 2008, Jadela acquired a further 6.5% working interest.