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 Reinventing a Historic and Prolific Reservoir Redwater is another major area with exciting opportunities for ARC and its shareholders. The Redwater oil field was one of Canada’s largest and most prolific oil discoveries. It was discovered in 1948 and was drilled up to 40 acre spacing by 1955. ARC purchased its initial working interest in the area in December 2005. Current production in Redwater is over 4,000 boe per day of high netback light oil. ARC’s average working interest in our operated wells is 98 per cent. ARC has been successful at increasing production by following disciplined production practices, reactivating old wells, and drilling new Leduc wells on structural highs identified by small 3-D seismic surveys. The most exciting prospect for Redwater is the CO2 enhanced oil recovery potential. If a CO2 flood at Redwater is proven to be commercially viable, it could potentially provide an incremental 15,000 boe per day of production. Since the acquisition of Redwater in 2005 ARC has drilled and built infrastructure to conduct a CO2 pilot injection project. CO2 injection began in 2008 and is ongoing. To date results have been encouraging. The project is a clear example of ARC's willingness to use technology to evaluate methods that may increase production in the long term. ARC has also teamed up with Alberta Innovates – Energy and Environmental Solutions (formerly the Alberta Energy Research Institute) and Natural Resources Canada in a project known as the Heartland Area Redwater Project. The objective of HARP is to test and evaluate the very large water saturated, porous space of the Redwater reef as a storage space for CO2 emissions. |
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