Other very positive points from the Range Resources presentation:
"In our Midcontinent, the division in the horizontal Mississippian, we've seen a 25% decrease in drilling days, allowing us to effectively double the length of our laterals and increase the number of frac stages with a very modest cost increase.
The horizontal Mississippian oil play is progressing very well. Our team there is optimizing quickly. We're now drilling and completing approximately 4,000-foot laterals with more stages and making better wells, while seeing only a modest increase in total well cost to around 3.2 million, which is excluding the saltwater disposal. And we fully expect that those costs will come down even more as we get more wells under our belt.
As shown in our new corporate presentation, our 2012 wells are performing significantly better than our previous wells, and although early, we believe that could be as much as 600,000 BOE wells. That would mean a 25% improvement in well performance with a very modest 10% increase in costs. This is amazing progress in only 6 wells.
The team is continuing to optimize midstream and power infrastructure along with implementing improved saltwater disposal, production designs and operations. We believe our team can continue to produce these wells at very low operating costs compared to the more traditional designs, and we're already recognizing significant benefits in costs and efficiencies."
Like I said, very exciting for AOK particularly if Range decide to do another horizontal JV on our acreage. Oil price closing above $90 on Friday is also a positive IMO.
AOK Price at posting:
12.0¢ Sentiment: Buy Disclosure: Held
