ANNOUNCES UPPER MONTNEY LIGHT OIL DISCOVERY AT TWO RIVERS
Leucrotta (LXE.V) drilled and completed an Upper Montney horizontal multifrac well at 10-08-83-16W6 to extend expiring lands in the Two Rivers area of British Columbia. The well was tested on cleanup for 10 days and had a flow rate on the last day of the test of 1,842 barrels of oil equivalent per day, comprising 685 barrels per day of 42 API light oil, 5.6 million cubic feet per day of gas with 1.3 per cent hydrogen sulphide (H2S) and estimated potential NGL recovery of 224 boe/d. The well was also testing substantial water and frac fluid at the end of the test as is normal for Upper Montney in the greater area. Leucrotta believes that it has discovered a large light oil accumulation and will now work toward further delineation and establishing the commerciality of this resource. Leucrotta does not anticipate that the discovery well will be placed on production prior to 2019.
Prior to drilling the well, Leucrotta and an industry partner came to an arrangement whereby Leucrotta contributed expiring lands in addition to geological and engineering expertise accumulated from its area operations and the industry partner contributed financing that was used for drilling the well and accumulating additional lands. Leucrotta will operate and have a 100-per-cent working interest in the lands and the industry partner will have an overriding royalty. Leucrotta now owns a 70-section contiguous block of Montney land surrounding the discovery well.
Note that the 70-section contiguous block is completely exclusive and additive to the 140-section contiguous block of Montney land at Doe/Mica where Leucrotta has been developing the Lower Montney Turbidite light oil resource.