Magnolia Petroleum has decided to give up on its Shimanek#2 well in Oklahoma due to high salt water levels and high associated costs.
The company said that, although hydrocarbons had been found, the high salt water saturation levels and the expense associated with its disposal led to a decision to plug rather than complete the well. The move will limit project expenditure to $175,000. The project budget’s remaining $400,000 will be reallocated to new drilling activity.
The Shimanek well will not affect Magnolia’s plans to drill conventional prospects identified on other leases within its portfolio.
Magnolia chief operating officer Rita Whittington said: “Based on the salt water and reserve levels encountered, we believe Shimanek would at best have been a marginal producing well but with high costs associated with the salt water disposal.
“We have multiple opportunities to drill more commercial wells on our leases, the US$400,000 set aside to complete the well has been reallocated to fund new drilling activity, either on our own or alongside established operators.”
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