Jaguar Resources Inc. is pleased to announce the commencement a four (4) well exploration Drilling Program at its Bannock Creek Property in the Province of Saskatchewan. This exploration well program, operated by Jaguar Resources, is anticipated to commence in the end of July. Jaguar Resources has a 50% interest in the exploration drilling program.
These wells are estimated to cost approximately $830,000 per well to drill, tie-in and complete. Based on current commodity prices the proposed drilling program would provide the Company with estimated netback of approximately $35 per barrel and establish a core operating area for expanded future operations. The Company estimates initial production rates of a successful well could be ranging between 100 to 150 barrels per day per well. Jaguar has arranged a financing facility to drill a four (4) well exploration program it has selected from the recent seismic that has been shot and interpreted on Bannock Creek. Drilling will commence the end of July 2015. Jaguar has an option with the drilling company to drill 6 more wells. Jaguar has surveyed 10 locations as of June 27, 2015.
The exploration oil well program has been selected following the recently completed 2D seismic program which was designed to identify and confirm closure for potential light oil traps in the stacked Red River, Winnipeg and Deadwood Formations of the Northeastern Williston Basin. The Company's first exploration wells which will be drilled and completed conventionally to a depth of less than 1,000 meters.
The initial non-operated 9-5 Bannock Creek exploration well, which was non operated by Jaguar, in northeast Saskatchewan which commenced drilling on May 12, 2015 experienced significant operational difficulties. The well did not reach the intended zones and was subsequently plugged and abandoned by the operator.
Jaguar Resources and Shadow Tree Income Fund L.L.P. (Shadow Tree), a fund managed by Shadow Tree Capital Management LLC, agreed to finance the Company's 50% of the AFE and the well that was drilled May 12, 2015. The Term Loan shall be secured by the general security agreement granting a security interest over all present and after-acquired personal property of Jaguar.