Dejour plans drilling to test Mancos/Niobrara potential south of Rangely oil field in Colorado

Source: Dejour Energy

Dejour Energy, Inc. (NYSE:DEJ) (TSX:DEJ) will drill an initial vertical well to test the Mancos/Niobrara potential on its 7,000-acre leasehold in Rio Blanco County, Colorado. This leasehold sits on the western flank of the Douglas Arch, separating the Piceance and Uintah Basins, directly south of the Rangely Oil field operated by Chevron since the 1960s. 

This well will be drilled in May 2011 and is designed to test both the upper and lower Niobrara sections of the Mancos Shale. In this area, the targeted zones are known to contain both oil and natural gas. 

It should be noted that private operators R. W. Bayless and Foundation Energy are currently exploiting the lower Mancos zone, approximately six miles to the southwest of Dejour’s proposed well location. 

Pending a successful outcome of the test well in proving the extension of the play to Dejour’s leasehold, Dejour, project operator and 72% working interest holder, plans to commence a formal horizontal well development program. Germaine to this operation, a secondary target in the upper Mancos known as the Castlegate Sand will also be evaluated within this initial test well. 

“The economics of assessing the production potential at South Rangely offers significant production upside with minimal capital expenditure. With a dry hole cost projected to be less than $500,000, this is a very low cost test that may open the door to a much broader and more significant development project through the application of current horizontal well drilling and completion technology”, states Dejour COO Hal Blacker.

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