Light Oil Montney Play

Blacksteel has an interest in a light oil Montney resource play in the Girouxville area of Alberta (the “Property”).

The Property consists of approximately 35 barrels of oil per day, 15 sections of land (9,600 acres) with up to 30 meters of oil pay and 200+ million barrels oil in place.

Blacksteel holds a 30% working interest in the Property while the operator, Drakkar Energy Ltd. (“Drakkar”) holds the remaining 70% working interest. 

Historically, the property has been underdeveloped due to capital constraints. There are 27+ Montney horizontal development locations identified on the Property.

Girouxville Property (Twp 75-76, Rge 21W5)

Land Plat with Montney wells

Montney Oil Pay

As shown in the log above, 30 meters of oil pay has been identified in the Montney Formation on Blacksteel’s land. 

Development Plan

Blacksteel and Drakkar have identified a plan to increase production from the Property to approximately 1,450 boe/d (65% light oil) with a $8.2 – $9.7 million capital program. 

  • The costs to drill, complete and tie-in each well on the Property is only $1.8 million due to the Montney being shallower in the Girouxville area, east of the deeper Montney.
  • Estimated IP30 of 311 boe/d (66% light oil) and EUR of 152,700 boe per well.
  • Blacksteel and its partner, Drakkar Energy Ltd. have plans to drill an additional SWD well and upgrade current battery.
  • Natural gas is used for operations, with the remaining flared under a permit. Blacksteel is evaluating the merits of a tie-in of the natural gas to a facility to the east, building a co gen plant and/or implementing a cryptocurrency mining operation. 
  • Much like a property to the east, the Property has waterflood potential. 
A plan has been developed to increase production from the Property to 835 boe/d (65% light oil) with $4.6 -$6.1 million in gross capital. 
With an additional $3.6 million in capital, Blacksteel believes the Girouxville Property could produce 1,450 boe/d (65% light oil).

In addition to developing its Girouxville Property, Blacksteel is evaluating additional projects that will increase shareholder value; this might include a business combination, entering into a recapitalization transaction and/or acquiring additional properties in Canada or internationally.