DENVER, Jan. 18, 2011 (GLOBE NEWSWIRE) -- Credo Petroleum Corporation (Nasdaq:CRED), an oil and gas exploration and production company with significant operations in the Rocky Mountain and Mid-Continent Regions, today updated its horizontal drilling activities in the Texas Panhandle.
In Lipscomb and Hemphill Counties, Credo owns an average 33% interest in about 3,000 gross acres, and currently operates 12 vertical wells. The wells are producing from the Morrow, Douglas and Tonkawa formations at depths from 7,000 to 11,500 feet. Credo's interests range from very small to 100% depending on the size of the spacing units.
Last year Chesapeake Energy completed two successful horizontal Tonkawa wells in the area. These wells significantly enhance the potential of Credo's offsetting acreage.The third horizontal Tonkawa well drilled in the play is also operated by Chesapeake, and is located about 2 miles west of Chesapeake's first well. Credo owns a 22% working interest in the new well which was drilled on a 320 acre spacing unit to a 7,600-foot vertical depth with a 4,400‑foot lateral. The well was fracture stimulated in 11 stages using a total of 4,000,000 pounds of sand and about 100,000 barrels of frac fluid. The company believes the fracture stimulation was the largest ever performed in the area. A pump has been installed on the well to remove the large volume of stimulation fluid, and the percentage of oil produced is steadily increasing as frac fluids are recovered. Approximately one mile to the northwest, Credo recently spudded its second horizontal Tonkawa well, the Bussard-Cameron 74-1H. The well is being drilled on a 320 acre spacing unit and is projected to have a 7,500-vertical depth and a 4,100-foot lateral. Credo owns a 32% working interest and is the operator. The company is preparing to drill additional horizontal Tonkawa wells in this play. MANAGEMENT COMMENT Marlis E. Smith, Jr., Chief Executive Officer, stated, "The emerging horizontal Tonkawa play in Lipscomb and Hemphill Counties is particularly exciting for Credo. We are in a prime location within an existing conventional Tonkawa field, which makes our acreage highly prospective for horizontal drilling.