Joint Venture with Tanager Energy, Inc.

Tanager Energy’s initial project incorporates the Leduc D-3 B Pinnacle Reef in Central Alberta, which is where the Joffre D-3 Oil Project is located (the "Joffre Project"). Viking owns a 50% working interest in the project, which consists of 4 oil wells and one water injection well.

These wells were previously suspended. After solidifying our joint venture with Tanager Energy, we mobilized the first well (initial production commenced on April 1, 2015) and intend to mobilize the remaining wells sequentially.

First Well:

After 5 days of anticipated monitoring and operating facility adjustments, the first well produced, without a pump jack, at a rate of 118 barrels of oil per day of 38 API gravity crude oil and 250 mcf of natural gas, totaling 160 BOE/D. The well is a flowing oil well with a flowing wellhead pressure of 435 psi. Now that production has been confirmed and testing complete, Viking and Tanager are in the process of installing the pump jack on the first well. The installation is expected to be completed by the end of July, 2015, and the mobilization of the remaining wells during is expected to occur by the end of the third quarter of 2015.

Mobilization Process:

Mobilization and reactivation efforts involve, among other things, completing the re-entry and downhole pressure survey to determine the current reservoir pressure, a critical element in determining the scope and anticipated production of this suspended oil pool. The survey with respect to the first well confirmed the reservoir pressure returned to 94% of the original pressure (i.e. the pressure that existed when the pool was discovered in 1986) due to the active water drive in the pool.

Following the pressure test described above, a production test is performed to confirm the productivity of the pool. The production test for the first well occurred between January 13th and January 15th, 2015 and the test results indicated a stabilized production rate of 290 BOE/d (235 barrels per day of oil and 325 mcf/d of gas).

  • The flowing wellhead pressure was stable at 475 psi, estimated to be a 7.7% drawdown of the reservoir. On a metric equivalent basis this is 52.5 cubic meters oil equivalent per day at 3265 kpa flowing wellhead pressure.
  • The fluid produced was 100% high gravity oil.

Following the production test, steps are taken to place the well on production through the existing pipeline located at the edge of the subject property. Such efforts include the design engineering for the equipment and piping for the tie-in to the separator, the flowline tie-in to the wellhead, as well as the re-activation of the discontinued flowline and its change in use from a gas line to an oil effluent line and its subsequent hydrostatic pressure test.