Sonoro Energy (TSXV: SNV) is moving towards becoming the newest junior oil operator on the markets, announcing this morning that it has secured the necessary permits from the Saskatchewan Minister of Energy and Resources to begin drilling.
With the license in hand to drill its first well, the company has also secured a drill rig and services for the well. The well, which is scheduled to be spud on November 22, is to consist of a vertical well that targets the Waseca formation. The planned well offsets a field operated by Baytex, which currently produces 1,800 bbls/d.
The firms operations are focused on the western Canadian sedimentary basin, following a farm-in agreement that it executed earlier this year. The company can earn up to a 70% working interest in a 1,840 acre land block within the Waseca channel heavy oil resource fairway. Sonoro has committed to drill up to 5 wells on the property, with $5.0 million committed for its exploration. A typical well in the region is estimated to cost $750,000, with payouts expected in under a year.
With the first well scheduled to be spud this month, a second well location has already been selected. The second well is expected to be multi-lateral, and well be drilled immediately after the first well. Lateral extensions from the well are slated to amount to 2,000 metres.
The two scheduled wells meanwhile are expected to be producing in the near term, with oil sales estimated to begin before year end.
Sonoro Energy last traded at $0.17 on the TSX Venture.
Information for this briefing was found via Sedar and the sources mentioned. The author has no securities or affiliations related to the organizations discussed. Not a recommendation to buy or sell. Always do additional research and consult a professional before purchasing a security. The author holds no licenses.
