DBRM
Saxet Deep Field Project
Saxet Field, Nueces County, Texas
Daybreak Oil and Gas, Inc., in November 2005, agreed to participate in a five well re-entry project in the Saxet Deep Field on a 320 acre lease in Nueces County, Texas. The Saxet Deep Field has previously been produced as an oil field but had been shut in for several years. Daybreak has a 31.67% working interest in the first well (8-C) of this project and a 23.64% working interest in the other wells (3-C, 7-C, 6-C and 2-C) in this project. Our net revenue interest (NRI) is 14.25% on production from all wells.
In May 2006, we started the re-work of the first well, the Weil 8-C well. This well was successfully reworked and placed into production in August 2006. In August and September 2006, we re-entered and started to produce from both the Weil 3-C and Weil 7-C wells. Two other wells the Weil 2-C and Weil 6-C were re-entered in September and October 2006, and are now being used as salt water disposal wells. The producing wells commenced production at gross initial rates of approximately 1000 mcf/d and have declined to about 300 mcf/d. There are multiple additional zones behind pipe in this field.
This project gives Daybreak an existing field with multi-zone potential. Extensive infrastructure has been added to produce the natural gas and oil reservoirs that were encountered.
The Saxet Field project is a relatively low cost and high reward project. Geological risk is minimal and engineering risk is moderate. That risk is however mitigated by the multiple horizons and five well bores.