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April
4, 2006
Storm
Cat Energy Corporation Provides
First
Quarter, 2006 Operational Update
CALGARY and DENVER " (PR Newswire) " April 4, 2006 " Storm
Cat Energy Corp. (AMEX:
SCU; TSX.V:
SME) today provided an update on the Company¨s U.S.
and Canadian operations. The highlights of the Company¨s
operations are included below.
Powder River Basin
The Company is continuing to
produce approximately 4.0 million cubic feet per day (MMcfd)
from 142 wells on its Powder River Basin properties.
The Company has received final
approvals on its 68-well Plan of Development from the Bureau
of Land Management (BLM). Drilling with three to four
rigs is expected to commence by the end of April.
Storm Cat entered into a Letter
Agreement to purchase approximately 3,550 net acres of federal
and fee leases in the Powder River Basin, Campbell County,
Wyoming. The Company is in the final process of title
due diligence with closing expected by late April.
The acquisition should yield up to 40 additional drillable
locations once permitted.
Elk Valley, British Columbia
The Company finished completing
two wells drilled in December 2005. The A84L well,
completed in the F, G and H coal seams by fracture stimulating
down casing, has been on production for 16 days. Production
rates have grown from an initial rate of 124 thousand cubic
feet per day (Mcfd) to as high as 204 Mcfd. The D85L
well was completed in the G through L coal seams by fracture
stimulating down coil tubing in eight separate stages.
The well produced for five days at 75 Mcfd until experiencing
downhole pump failure. Initial results and evaluation
by Storm Cat engineers are showing better per-well performance
than models predicted.
Storm Cat re-activated three wells shut-in by the previous
operator. The three wells are producing a combined 150 Mcfd.
Company engineers are again encouraged by initial results
from the wells which are performing as expected at this
stage of production.
Based on the results to date, six wells are being licensed
to target both the upper and lower Mist Mountain coal sections
with expected initial spud dates of early June. An
additional six drilling locations are currently being considered
for drilling in the late fall. In addition, engineering
services to aid in the design of compression and related
facilities are being evaluated.
J. Scott Zimmerman, President
and Chief Executive officer said: ™We anticipate that the
Elk Valley project will be evaluated for commerciality within
the next 180 days. The next six wells drilled are
designed to further define the potential of the project.
Following the re-activation of wells here, we are increasingly
encouraged by the potential of Elk Valley.'
Other Projects
In Central Alberta, the Company
acquired an additional 2,560 acres in an early March lease
sale bringing our gross lease acreage position here to 7,828
acres (6,868 net). All lands are prospective for Mannville
coal development.
In Alaska, The Northern Dancer
No. 1 well reached total depth (TD) of 6,243 feet in mid March.
Openhole logs were run and casing set to TD. The
well encountered a significant amount of total coal, as well
as interbeded conventional sandstones. The Company is
currently evaluating the logs and cuttings and expects a completion
attempt in late summer 2006.
The three-well exploratory drilling
program in Moose Mountain, Saskatchewan has been completed.
Based on log and sample evaluation, the three wells each encountered
between 40 and 50 metres of net pay in the Second White Specks.
Openhole logs are being evaluated to determine completion
procedures. Completion operations will commence after spring
break-up, pending weather and rig availability.
Finally, Storm Cat¨s Board of
Directors has approved the acquisition of undeveloped leasehold
in the Fayetteville shale play in Arkansas. A definitive
Purchase and Sale agreement has been entered into with closing
expected in early May. The Company is identifying potential
drill sites and is determining a prudent drilling program
to assess productive potential from its leasehold.
At March 31, 2006, Storm Cat
was the operator of approximately 380,850 gross (159,200 net)
acres in North America.
IPAA OGIS Conference
Storm Cat also today announced its participation in
the 2006 Independent Petroleum Association of America's
Oil and Gas Investment Symposium in New York. Storm
Cat's CEO and President, J. Scott Zimmerman will provide
an update to investors on Monday, April 10, 2006 at 2:25
PM EDT. You may access the presentation slides and
the audio portion of the presentation by logging onto the
Storm Cat home page at
www.stormcatenergy.com.
About
Storm Cat Energy
Storm Cat Energy is an
independent oil and gas company focused on the pursuit, exploration
and development of large unconventional gas reserves from
fractured shales, coal beds and tight sand formations. The
Company has producing properties in Wyoming¨s Powder River
Basin, exploration and development acreage in Canada and Alaska,
and high-risk, high-reward exploration acreage in Mongolia.
The Company's shares trade on the American Stock Exchange
under the symbol ™SCU' and in Canada on the TSX Venture Exchange
under the symbol ™SME.'
Company Contact:
Scott Zimmerman, President and Chief Executive Officer
Paul Wiesner, Chief Financial Officer
Phone: 87-STORMCAT
www.stormcatenergy.com
By Order of the Board of Directors
Storm Cat Energy Corporation
J. Scott Zimmerman
President and Chief Executive Officer
Forward-Looking Statements
CAUTIONARY STATEMENT:
This publication contains certain ™forward looking statements',
as defined in the United States Private Securities Litigation
Reform Act of 1995 relating to matters such as the Company¨s
drilling and other exploration plans and projected well
economics. Forward looking statements are statements
that are not historical facts; they are generally, but not
always, identified by the words ™expects,' ™plans,' ™anticipates,'
™believes,' ™intends,' ™estimates,' 'projects,' ™aims,'
™potential,' ™goal,' ™objective,' ™prospective,' and similar
expressions, or that events or conditions ™will,' ™would,'
™may,' ™can,' ™could' or ™should' occur. Forward-looking
statements are based on the beliefs, estimates and opinions
of Storm Cat¨s management on the date the statements are
made; they involve a number of risks and uncertainties.
Consequently, there can be no assurances that such statements
will prove to be accurate and actual results and future
events could differ materially from those anticipated in
such statements. Storm Cat undertakes no obligation
to update these forward-looking statements if management¨s
beliefs, estimates or opinions, or other factors, should
change. Factors that could cause future results to
differ materially from those anticipated in these forward-looking
statements include, but are not limited to the volatility
of natural gas prices, the possibility that exploration
efforts will not yield economically recoverable quantities
of gas, accidents and other risks associated with gas exploration
and development operations, the risk that the Company will
encounter unanticipated geological factors, the Company¨s
need for and availability of additional financing, the possibility
that the Company may not be able to secure permitting and
other governmental clearances necessary to carry out the
Company¨s exploration and development plans, and the other
risk factors discussed in greater detail in the Company¨s
various filings on SEDAR (www.sedar.com)
with Canadian securities regulators and its filings with
the US Securities and Exchange Commission, including the
Company¨s Form 20-F dated July 1, 2005.
THE TSX VENTURE EXCHANGE
HAS NOT REVIEWED AND DOES NOT ACCEPT RESPONSIBILITY FOR
THE ADEQUACY OR ACCURACY OF THIS RELEASE.
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