Its first operated well in the Normangee Oil Project is expected to spud in the next few days while the vertical pilot well at the Petro-Hunt AMI Area of its Delta Oil Project is due to spud around the end of April.
Which is promising given the recent results of both EOG Resources Inc (NYSE: EOG) and Contango Oil and Gas Company (NYSE:MCF) in drilling and completing laterals in the Lower Woodbine to the west and south of Sun's Normangee Oil Project leases, within Madison County, Texas.
Sun has a 50% working interest in a 3,952 gross acre package of oil and gas leases located on the Leon County-Madison County border, Texas, USA (Normangee Oil Project).
The balance of the working interest (50% WI) in the Normangee Oil Project is held by Amerril Energy LLC.
The company also noted the F. Thompson-1H well at the Amerril Oil Project continues to flow back a mixture of frac fluid and oil, through recently commissioned permanent production facilities.
Normangee Oil Project
Sun, as operator of the 50% owned Normangee Oil Project, expects to spud the Jack Howe-1H well targeting the Lower Woodbine in the next few days.
This follows completion of planning and the securing of a rig.
It expects the Jack Howe-1H vertical pilot well to take 15 days to drill, core and evaluate the primary objective Lower Woodbine objective. It will also reach the underlying Buda Formation target prior to wireline logging both objectives once total depth is reached.
The company noted that it was encouraged by Contango enjoying a 100% success rate for the 12 wells it drilled in 2013. These have an initial thirty day average production rate of 859 barrels of oil equivalent per day for the first 11 wells.
Sun has a 50% working interest in a 3,952 gross acre package of oil and gas leases located on the Leon County-Madison County border.
The remaining interest is held by Amerril Energy LLC.
Delta Oil Project - Petro-Hunt AMI
Meanwhile, the company noted that Petro-Hunt LLC - one of the world's largest privately held companies and operator of the Petro-Hunt AMI area - has confirmed that preparations for drilling are continuing and the first well into the Lower Woodbine oil target is currently anticipated to spud around the end of the month.
Once operations commence, the vertical pilot well will be drilled and evaluated.
A decision will then be taken by the participants to either complete the pilot well as a vertical producer, or to side track the well bore to drill a lateral into the Lower Woodbine.
The AMI consists of approximately 7,832 acres in northern Leon County.
Petro-Hunt and Sun have now leased over 3,240 acres within the AMI.
Sun has a 25% interest in the AMI. It also retains over 10,000 net acres elsewhere in the wholly-owned Delta Oil Project that may be the subject of future activity, by way of farm-out, joint venture or direct drilling activity.
With the Woodbine oil play believed to be comparable to the prolific Eagle Ford shale formation, which crossed the 1 million barrel per day production milestone in August 2013, Sun Resources' move to drill further wells has the potential to deliver oil flow for the company.
This is notable given that Contango Oil and Gas and EOG Resources have enjoyed recent drilling successes in the Woodbine near the Normangee Oil Project.
Contango notably enjoyed a 100% success rate with 11 of its 12 wells drilled in 2013 producing at an initial thirty day average production rate of 859 barrels of oil equivalent per day.
The Jack Howe-1H well in the 50% owned Normangee Oil Project, being the company's first operated well, will also highlight its competency as an operator.
Separately, the well with Petro-Hunt is noteworthy given its history in participating in the discovery of oil reserves in almost every major oil producing region in the U.S. with operations in the Mississippi, Louisiana, East and South Texas, the Texas Gulf Coast, Wyoming and the Rocky Mountains Williston Basin areas.
Gina Rinehart's Hancock Prospecting has also seen the upside with a 19.53% investment in Sun Resources.
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