Whitebark Energy to begin Wizard Lake oil, gas production following successful Rex-4 well

Whitebark Energy's (ASX:WBE) share price remained flat today, despite the company flagging plans to prepare to start producing oil and gas from its Wizard Lake project acreage in Alberta, Canada—an established oil and gas province. 

The microcap has been absent from the main bourse since late 2020 during a protracted voluntary suspension which was listed in early June this year. That suspension was in place while the company restructured its Canadian operations. 

In short, after a lengthy wait, shareholders will be pleased to see the company now getting back on with its flagship Wizard Lake oil and gas project—though they are likely underwhelmed by the lack of attention Whitebark has received since recommencing trade. 

New evidence of oil, gas 

Drill cuttings from Rex-4 return evidence of fluorescence, a widely used geotech imaging practice in the energy sector to confirm the presence of oil underground. 

At this time, the company expects Rex-4 to produce each day: 

• 300 barrels (bbl) of oil 

• 1,400 thousand square cubic feet of gas 

• Total 750 barrels of oil equivalent per day 

• Full life of well production of 155,000bbl; 1.3 billion cubic feet gas

Significant well design 

Whitebark will now progress to fracking Rex-4 ahead of full capacity production. 

The well sits at a total measured depth of 3,647m and will accommodate 50 fracture intervals across a 2,318m horizontal section. 

Before full-capacity production can begin, the company will first need to remove stimulation fluids from the well, which is typically a slow process that must be conducted at a measured pace so as to retain pressure dynamics downhole. 

As the company begins removing fluid from the well post-fracking, increasing amounts of oil and gas will begin to be recorded across the cleanup period while the ratio of hydrocarbons eventually supersedes that of fracking fluid. 

The company expects production to begin by late October. And in the meantime: it is now getting started on drilling the next well at Wizard Lake, Rex-5. 

Management elated 

“I couldn’t be happier with performance of the team involved with Rex-4, remaining on schedule and on budget,” Whitebark acting CEO Dr. Simon Brealey said. 

“I am looking forward to the hydraulic frac program and significantly ramping up Wizard Lake production…this is an excellent result that gives us confidence as we now turn to Rex-5 as the next well to grow our business.” 

To get an idea of Whitebark's recent history, one must look at the 5Y chart, which shows the period through which Whitebark remained in voluntary suspension. Finally, it looks like things might start to pick back up.