Reproduced from an article originally published July 3, 1991
A unique drilling project in Manitoba's oil patch was completed Friday.
Tundra Oil and Gas Ltd. has been working west of Virden for the past two weeks on a horizontal well. The specialized drilling rig finished its job Friday, two days ahead of schedule.
Bob Puchniak, president of Tundra, complimented the local crew headed by Tim Howell, who were able to complete the work "without a hitch".
Located 15 miles west of Virden in the Daly Oilfield, the well has been drilled vertically to a depth of 2,500 feet and then horizontally an additional 1,600 feet.
A first for Manitoba, the horizontal drilling method has been used successfully in both Alberta and Saskatchewan. If this experiment pans out for Tundra, such wells may become common in Manitoba as well.
Although it is too early to estimate the capacity of oil the well will produce, Mr. Puchniak was confident that once the service rig is in operation on the site, the well should bring in a "pretty good quantity of oil" from the estimated 750 feet of pay tapped by the well. Much larger volumes of oil can be recovered from the underground reservoir than by using conventional drilling methods.
Contacted at the drilling site on Thursday, Mr. Howell was pleased with the progress of the work and stated that no major problems had been encountered, contrary to experiences at other horizontal drilling sites.
Costs, including specialized equipment, have been estimated at three to four times the cost of conventional drilling methods. Despite the approximate $700,000.00 price tag, the well should, if successful, drain a much larger part of the oil reservoir and recover a much higher percentage of the oil in place. With conventional methods, less than 20 per cent of the oil reservoir is recovered.
Tundra is willing to take the gamble on the possibility of increased volumes because of a Manitoba Government tax incentive program announced last September. The program, due to expire at the end of the year, provides a royalty and tax holiday for 47,000 barrels produced from a horizontal well.
"It's quite an attractive incentive program that we hope to take advantage of,” said Mr. Howell. If this well is declared a success,
Mr. Puchniak expects that Tundra will undertake another similar well somewhere else in the province before fall. The company wants to experiment with the method in several different reservoirs, all of which pose different drilling problems, he said.
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