This is where the "elephant" started. October 2006
link on Couch site http://www.couchoil.com/daily/102405.htm
Sugarloaf Hosston Prospect ? DeWitt County, Tx 20,000 Acre Four Way Closure ? new porosity seismic technology ? 15 years generating this prospect. Two Trillion (not Million? not Billion?. but Trillion) Cubic Feet of Gas Potential ?
I can hear the elephants stomping
link on Couch site http://www.couchoil.com/daily/102005.htm
Sugarloaf ? Hosston ? 2 TCF potential I spent several million dollars over the last few years to develop new Seismic Algorithms to enhance our discovery rate. We worked with much fanfare developing Wave Energy Absorption (WEA). Now with low fanfare (but still with great expense) we have been working on Porosity algorithms that are having more success than WEA. We have two successful wells on line from this process used in the Flour Bluff field.
Key Largo is the next research well. Sugar loaf is a research well? one target 800 BCF? with the deeper 20,000 ft target closure conservatively 1 TCF. We have closure over 16,000 acres. Texas Crude drilled 2 other successful wells using the technology which I did not participate in since I was originally a doubting Thomas. These two wells will have over 30 offset wells. So sometimes I make big mistakes.
This technology was started by Shell 20 years ago which much ado? yet with not much success. In the last few years several geophysics have used the technology in areas where they had at least 10 to 20 years of work station experience. Folks in England at Oxford and Cambridge have figured how to apply the porosity gradient to 2 D seismic. It takes 2 to 3 years to apply this to 2D seismic. We have been involved in funding this technology to 20,000 square miles of 2D seismic. It only takes 3 months to apply the technology to 3D seismic. We have thousands of squares of 2D seismic already shot within 50 miles of the Gulf Coast and in our coop library. Our initial research results are pure success with the drill bit.
I hope our current 75% success rate will increase to 80% with this technology. I hope to lead the funding charge of several companies that will share this technology looking for larger reserves or elephant hunts as we have found with the Sugarloaf well. I try not to get excited when it comes to research? because we and affiliates have failed so many times before. Initial results on about 6 wells successful wells say we are finally?. maybe? on the right track.
The new seismic tool allows us to look for at least 20% porosity within about 6% points + or -. Some of the work station boys think they can get this down to a 4% or 2% variable. I say ..?show me?.. Each 2% points probably adds 1 BCF in reserves (with 100+ acreage drainage) per planned multi zone well. That is only a $10 million dollar reserve improvement per well. That will pay for each elephant hunt type well? alone? just with the porosity or reserve improvement. A poor result for a deep well would be 10 BCF or $100 million. 1 TCF possible ? as in the Sugarloaf is $10,000 million or $10 Billion in reserves. We will try to drill at least one of the massive reserve deep target wells each quarter. We are trying to finish the South Deep Lake well now. Red Quill is on the front burner.
My initial review says their only 18 companies in Texas who are in financial position to tackle deep large reserve wells. We are one of the few. I will slowly encourage them to utilize these seismic tools.
Charles Couch Couch Oil & Gas, Inc. 1919 Rhome St. Dallas, Tx 75229 of (972) 444-0256 cell (214) 616-3832 fax (972) 444-0276
ADI Price at posting:
26.5¢ Sentiment: Hold Disclosure: Held
