Corridor has reported the initial results of fracturing and flow-testing of the McCully L-38 and P-47 wells located in the northeastern segment of the McCully natural gas field in southern New Brunswick. The wells were fractured with liquid propane followed by flow-back and initial flow test operations. This was the first time that fracturing with propane was conducted in the McCully Field, as completion operations in previous years had mainly used combinations of water and methanol as the frac fluid. The positive results (described below) are attributed partially to reservoir characteristics and partially to the successful application of propane as the frac fluid. Corridor's technical staff is reviewing seismic and other data to identify a number of additional drilling locations in the vicinity of these wells for potential inclusion in the 2010 drilling program.

Four fractures were separately propagated in the P-47 well, including two in the "E" sand and two in the "G" sand. The four zones were then commingled and flow tested. Initial flow-back (primarily gaseous propane) was directed to the flare stack for a short period of time to avoid exceeding heating value limits acceptable to Maritimes & Northeast Pipeline (M&NP). Once the percent of propane present in the flow-back declined to acceptable levels, the flow-back gas was directed to the gas plant for an initial test period of 46 hours. At the end of this initial test period the flow rate was measured at 2.6 mmscf/day at a flowing wellhead pressure of 18,600 kPa (2,702 psi).

The flow rate was constrained to ensure the composite McCully production did not exceed the heating value limits acceptable to M&NP. Longer term production will be required to clean up the amounts of propane (approximately 14%) remaining in the produced gas and to more accurately project the long term performance of the well. Based on the initial results, Corridor estimates the initial production capacity of the well to be 9 - 10 mmscf/day at the McCully gathering system line pressure (3,500 kPa or 500 psi). The well is currently shut in for a pressure build-up and to run production tubing.

Tags: Corridor Resources Inc.