I have heard this well is producing both oil and gas. Does anyone have any information on the production amounts? More importantally, has anyone heard the current rate for leases in that area? The last offer we had was 300 for a 3 year lease with a 2 year option with 20% royaltiy over a month ago.

Our source in the courthouse tells us going rate is 300 to 350 per acre now, For three years, with option to renew. 

Several competing companies and the good signs of the currently drilled wells are driving prices up.

12 July 2011 

Pryme Energy Limited (Pryme) provides the following update on operations at its Turner Bayou project in 

Louisiana, USA.   

The Turner Bayou project comprises approximately 80 square miles (50,000 acres) which have been 

imaged by a proprietary 3D seismic survey.  Primary targets are the Austin Chalk formation at 15,300 

feet and the Eagle Ford formation at 16,000 feet. 

Deshotels 13H No.1 (40% Working Interest / 30% NRI) 

The Deshotels 13H No.1 well in North Bayou Jack Field has reached a total vertical depth of 15,000 feet 

(4,572 metres) in the upper portion of the Austin Chalk formation.  The vertical section of the well should 

be logged and the intermediate string of casing cemented in place this week, which will then be followed 

by the drilling of the 4,000 foot (1,220 metres) horizontal section.   

“We begin drilling the horizontal leg later this week and are confident of intersecting a similar oil bearing 

fracture network to that encountered in the Deshotels 20H No.1 well,” said Justin Pettett, Pryme’s 

Managing Director.  “At least twelve oil and gas bearing fracture zones were intersected in the horizontal 

leg of the Deshotels 20H No.1; they were accompanied by significant oil and gas shows which were 

produced to the surface during drilling and confirmed the prospectivity of the Austin Chalk formation 

within the project area.”   

The Deshotels 13H No.1 well will be drilled to a total measured depth of approximately 19,000 feet 

(5,790 metres.)   

For further information please contact: 

Justin Pettett      Ryan Messer 

Managing Director     Chief Operating Officer 

Pryme Energy Limited     Pryme Energy Limited 

Telephone: 61 7 3371 1103    Telephone: 1 713 401 9806 

Website: www.prymeenergy.com    ASX Code: PYM OTCQX Code: POGLY 

Had 2 offers – 1st offer was for $150 acre for 5 years paid up, 1/5 royalty.  Second offer from different company for $200 per acre, 3 year paid up with option to renew for 2 years at $200 per acre, 1/5 royalty.  The 1st offer I now know was from Anadarko, they have now offered to match the second offer.  Not sure what to do, would like to get something better than 1/5th and a better bonus also.  Anyone else out there getting offered anything better?  The landmen are putting the hard sell on us (if you don’t sign you’ll get left out, etc.).

 Land is located off Hwy 1179

Drilling is delayed due to the spring flood of the second well in the Dupont-Odenburg area.

The following is on the state mineral site:

DRILLING SUSPENDED

001 04/12/2011 013 02S 05E W 4500

DRLD T/ 4500’; RAN 13-3/8" CSG T/ 4500’ & CMT W/ 4000 SXS UP TO SURFACE; INSTALLED CAP; RIG MOL

DUE TO 2011 SPRING FLOOD & WILL RETURN IN JUNE WITH BIGGER RIG TO DRL TO TD;

That is encouraging, Gochay. Good news for Avoyelles.

There is a meeting May 11 in Lafayette at the offices of Liskow and Lewis, 812 Harding St.  that Andarkp E & P Company LP is planning to dissolve units of the Austin Chalk in Southern Avoyelles. A map shows the lands to the west and east and including the Goudeau area, in parts of T2S-4E, T2S-R5e, T2S-R6E and T1S-R4E.

There is no explanation in the letter why they are dissolving, but it is obvious the next step will be to create larger units which can handle the longer legs of horizontal wells.

I read in the Marksville Weekly News this week that Avoyelles should see several wells being drilled by the end of this year.

received this offer:  $200 per acre for 3 years, then option for two more years at an additional $200 per acre. (Area South of Cottonport, La.

Dehotels Well Site

slideshow

Turner Bayou 3D Seismic Project

The Deshotels 20-h No.1 well (40% working interest net to Pryme), in Pryme’s Turner Bayou chalk project in the North Bayou Jack Field, is the first deep well to be drilled within the Turner Bayou 3D seismic survey. The well was drilled to a depth of 16,400 feet (5,000 metres) vertically with a 3,755 feet (1,144 metre) horizontal leg through the austin chalk formation which is predominantly oil bearing in this region. The well location was confirmed using high resolution 3D seismic data from a survey carried out in 2007 and data from surrounding well bores.

Mechanical issues impeded the effective completion of the Deshotels 20-h No.1 well. completion crews were unable to

Production facilities at Turner Bayou

run 2 7/8 inch tubing past a damaged liner hanger (located approximately 15,000 feet deep) and into the top of the 4 1/2 inch production liner. The well was put into production during the quarter and remediation efforts have been suspended until after the drilling of the next well.

The well is currently producing at around 200 Bbls/day of oil and 150 Mcfd of natural gas. Natural gas is being flared onsite until such time as construction of the flow line to the main gas sales pipeline is complete. Based on well production characteristics to date we expect this rate of production to remain fairly flat, it is not indicative of expected production from austin chalk wells drilled in Turner Bayou.

The drilling of the Deshotels 20-h No.1 has reduced the geological risk of our Turner Bayou exploration program and provided valuable support to our seismic interpretation of the austin chalk formation within the project area.

anadarko Petroleum corporation (NYSE: aPc) has leased a large amount of acreage to the west of and contiguous to leases held by Pryme and its partners in the Turner Bayou chalk project. The interest in our immediate area from one of the world’s largest independent oil and gas exploration and production companies is encouraging and provides support for our strategy of exploring the austin chalk and deeper plays within our leases. The acreage map, on page 7, illustrates the known anadarko acreage position in relation to the approximate lease position of Pryme and its partners. It is possible that anadarko’s acreage position is larger than illustrated as leases are not filed as public record.

Whilst anadarko’s lease position is significant, we believe that, based on our interpretation of our 3D seismic survey and the results from the Deshotels 20-h No.1 well, we have secured the heart of the play.

The project focus is now on drilling well number two which is expected to spud in early May.

Parish AVOYELLES

Field 0800 BAYOU JACK, NORTH

Operator Well Serial Well Name Well Permit Date SCT TWN RNG MRN Total Depth Report Date API Num Number Scout Detail Status Number Scout Detail

N054 NELSON ENERGY, INC. 243093 AUS RA SUAA;DESHOTELS 001

04/12/2011 17009206360000 01 ETAL 13H PERMITTED-INITIAL REPORT

04/12/2011 013 02S 05E W 20146

199.7’ FSL & 404’ FEL OF SEC 13. PBHL: N 0 D 20’ 51" W – 4766’ FROM SURF LOC IN SEC 13.

Field 3648 EOLA

S229 SANCHEZ OIL & GAS CORPORAT 242757 CF-WX RB SUA;HENRY BOONE 001 02/14/2011 010 02S 02E W 1520

04/19/2011 17009206350000 05 JR DROVE 16" T/ 40’; SPUD 4/17/11; DRLD T/ 1520’;

I received a letter like this a couple of weeks ago, I really don`t understand it at all, could someone explain it in every day english? I have bout 40 acres on the Evergreen-Goudeau road ( 361 ) Bout 10-12 yrs ago I leased 20 acres to an oil co. for $6000, is this about the same thing? Thanks a lot…. 

A while back someone said that EOG took a large Blackstone lease in northern Avoyelles. Also heard recently that a herd of Chesapeake landmen, the guys that dig in the courthouse to find land owners, showed up in Marksville seeking long term hotel rooms. Pure rumor at this point.

This is a portion of the address by George Lloyd of Pryme Oil and Gas (now Pryme Energy) to the shareholders at the annual meeting over the weekend. Annual General Meeting 2011 Chairman’s Address

 Turner Bayou in Avoyelles Parish has the potential to lift our oil production from the present 150 barrels per day to several thousand barrels per day.  

We commenced drilling our first Turner Bayou well in 2010 and completed it early this year. While the well has not met our production expectations, due to mechanical issues during completion, it has confirmed the basis on which we have chosen to thoroughly explore the Austin Chalk formation within our leasehold. The well also provided tantalizing oil shows from the Wilcox formation, which is above the chalk, and the Eagle Ford formation immediately below the chalk; once our chalk exploration program is well-established we expect to test both of these formations in greater detail.

The first Turner Bayou well is currently producing at about 200 barrels of oil and 150 Mcf of gas per day; we expect each successfully completed chalk well should initially produce over 1,000 barrels per day of oil of which Pryme’s share would be over 300 barrels per day. A considerable effort has gone into evaluating the technical difficulties which were encountered with the first well and steps have been taken to avoid these in future wells.

We are advanced in preparing for the next well and expect to spud next month. Current planning for the Turner Bayou project contemplates a fully developed field of over 30 Austin Chalk wells at a spacing of around 640 acres, we expect to be well advanced with our third Austin Chalk well by the end of this year and then drill up to 6 new wells during 2012, increasing to 12 new wells per year in 2013 until fully developed. We also expect to re-enter the first Turner Bayou Chalk well during the year and take further steps to remediate it and lift its production.

Austin Chalk wells typically show high initial production followed by a rapid decline to a lower level that is generally sustainable over many years. Our planning shows that, by the fourth well, we should have a project which is creating substantial free cash flow and is self-sustaining from a capital cost point of view.

Gochay,

A unit is a defined area of land, usually 640 acres which matches a section. Anyone who owns land/mineral rights in that unit shares in the well drilled anywhere within that unit.

Because Avoyelles has many old Spanish land grants which are smaller than the English 640 acre square units made after 1803, the units made in 1992 may be smaller.

Also, because of horizontal drilling, the leg of he well extends farther than the typical vertical well, so there fore largere units may be formed. The unit for the first Deshotel well between Dupont and Odenburg, for example, i think was for about 1000 acres.

So I am assuming the notice you received is because you own land near a unit which will be dissolved, so the old unit or part of it can become part of a larger unit I would think. 

Very interesting Gocha, Could they be making larger units with more acreage and that is why they are dissolving the older ones? Can you share the wording of the letter?

received letter yesterday from law firm to dissolve certain existing units for the austin chalk zone in south avoyelles parish that im in.

letter included map showing units to dissolve

A friend of mine who owns land on Red River says he got $25 an acre to do some sesimic testing, then $175 for three years. This must be different from the Dupont wells.

Price per acre for minerals in Avoyelles ranged from $151 to 371 per acre at the March 2011 Louisiana Mineral auction of state owned lands.
Many land owners we have spoken to have been offered 150 an acre.