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Core Property Overview West Central Alberta Alberta Plains Williston Basin Reserves
Home > Operations > West Central Alberta > Key Initiatives

2010 Key Initiatives

West Central Alberta

  • Advance oil exploitation initiatives in the Carrot Creek, Cardium, Highvale Banff, Brazeau Nisku, St. Anne Banff and Spirit River Gething projects. Although not large in scope, each of these projects provides the opportunity to deliver very strong returns, production and reserves through the implementation of waterfloods or further horizontal well exploitation.
  • Exploit the Doig, Montney and Bluesky natural gas- bearing horizons at the Spirit River, Kakut, Webster and Rycroft horizons on the Peace River Arch area.
  • Maximize natural gas production volumes at existing properties with production optimizations, recompletions and workovers. Rationalize disparate natural gas assets through trades, acquisitions and sales.
  • Evaluate and maximize the value of the large undeveloped land base acquired in previous exploration initiatives and from four recent corporate acquisitions. Use farm-outs, sales and trades to derive value.

In 2009, Zargon spent $8.68 million of field-related capital in the West Central Alberta core area, which represented 93 percent of the $9.31 million of property cash flow generated by this area. Zargon drilled 4.1 net wells, which resulted in 2.8 net natural gas wells and 1.3 net oil wells.

This core area’s field capital programs were augmented by $11.87 million of capital pertaining to the Masters and Churchill corporate acquisitions, taking the total capital program to $20.55 million, or 221 percent of the core area’s cash flow. As a result, Zargon increased West Central Alberta production by 21 percent to 2,345 barrels of oil equivalent per day, and proved and probable reserves by 16 percent to 6.20 million barrels of oil equivalent.

In 2009, Zargon was able to continue this core area’s capital efficiencies by delivering a proved and probable finding, development and acquisition cost of $12.07 per barrel of oil equivalent. In particular, Doig exploitation gas wells at the Kakut property on the Peace River Arch provided large gains in reserves and production.

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