Delta Oil and Gas, Inc. has successfully drilled its second Texas Prospect well (the 'Donner #2') to total depth and, based on excellent shows on the mud logs, unanimously agreed with its partner to complete the well for the production of hydrocarbons.

The Donner #2 was spud on June 28, 2011 and a total depth of 7,550 feet was achieved on July 8, 2011. A suite of logs was run to total depth and five zones were identified as potentially capable of producing hydrocarbons. Based on the initial data, Delta and its partners decided to set production casing to 7,500 feet. The well was perforated in the Lower Hackberry. The Company's geologists and reservoir Engineers see the likelihood of successful completions in multiple zones within this well bore.

Initial tests of the first zone were completed and the well flowed oil at the approximate rate of 48 barrels per day ('bopd') with trace water on a 5/64 inch choke. Immediately following the test period, the well was shut in, in order to install a new battery facility. Once the well was shut in, the shut in tubing pressure at surface exceeded 1000 psi. It is expected that the well will be on full production within two weeks.

Delta anticipates being able to perforate up to 4 additional pay zones once the initial zone is depleted. Delta will be evaluating the production rates and the Company has instructed it's Consultants to set locations for at least one additional well based on the 3-D Seismic and the success of Donner #1 and #2. Consideration may be given to drilling a Donner #2 offset well to provide separate and concurrent access to the natural gas zone located from 7,294 to 7,302 feet. Once flowing production has stabilized on Donner #2, the Company will provide further updates.

The Texas prospect contemplates the drilling of a total of three wells in the Newton County area. The Donner #1 which was drilled to a total depth of 7,600 feet on June 4, 2010 continues to flow oil at the approximate rate of 45 bopd of very high quality 42 API oil. Delta owns a 40% gross working interest in the wells covered by this drilling program and at present, has fully paid the drilling and completion costs associated with the Donner #1 and Donner #2.

Tags: Delta Oil & Gas