El Toro Project
EnerJex’s El Toro Project is located in Atascosa and Frio Counties in Texas, just south of San Antonio in the heart of one of the most productive oil regions in the world. As of December 31, 2012, the Company owned an average working interest of 46% in 3,435 acres. EnerJex announced successful production results from three new wells in this project during early 2012. Two of the wells achieved an initial production rate of 40 to 50 barrels of oil per day each, and one well achieved an initial production rate of 20 to 30 barrels of oil per day from the Olmos formation at a depth of 4,500 feet. The Company drilled and completed 3 new wells in its El Toro Project during 2012 with a 100% success rate.
EnerJex believes its El Toro Project has the potential to yield millions of barrels of recoverable oil. Multiple oil fields surround the Company’s acreage, which combined have produced more than 100 million barrels of oil since the 1950’s from the Olmos formation. The Company believes its El Toro Project acreage was neglected due to its relatively tight (low permeability) reservoir characteristics. Recent advances in stimulation technology have enabled EnerJex to drill and complete new oil wells in this project with a high degree of success. The first two wells drilled by the Company produced approximately 100% more oil during the first 12 months of production than the best well in a directly adjacent field which has produced approximately 10 million barrels of oil.
EnerJex’s Mississippian Project is located in Woodson and Greenwood Counties in Southeast Kansas, where the Company owned a 90% working interest in 3,000 acres as of December 31, 2012. In addition, EnerJex has an agreement in place to acquire a 90% working interest in approximately 1,300 adjacent acres upon fulfilling certain drilling milestones related to its existing acreage. This project produces oil from the Mississippian formation at a depth of 1,700 feet, and the Company believes it has the potential to produce at a stabilized rate of more than 1,000 barrels of oil per day once it is fully developed. EnerJex drilled and completed 35 new oil wells and 14 new secondary recovery water injection wells in its Mississippian Project during 2012 with a 98% success rate.
According to the Kansas Geological Survey, the Mississippian formation has cumulatively produced more than 1 billion barrels of oil in Kansas and represents approximately 25% of the state’s 40 million barrels of annual production. EnerJex’s Mississippian Project is estimated to have produced more than 5 million barrels of oil since 1920.
EnerJex’s Cherokee Project is located in Miami and Franklin Counties in Eastern Kansas, where the Company owned an average working interest of 85% in 10,295 acres as of December 31, 2012. This project produces oil from the Cherokee formation at a depth of 600 feet. EnerJex drilled and completed 91 new oil wells and 86 new secondary recovery water injection wells in its Cherokee Project during 2012 with a 99% success rate.
The Company’s Cherokee Project is located in the prolific Paola Cherokee Field. According to the Kansas Geological Survey, this field has produced approximately 30 million barrels of oil and continues to produce more than 900 barrels of oil per day.