Cirrus Energy commences production at field in the Netherlands

Cirrus Energy has announced that its wholly owned subsidiary in the Netherlands, Cirrus Energy Nederland has commenced commercial production from the L8-D field.
The producing well, L11b-A06, was drilled in early 2009 into the L8-D field from the L11b-A production platform which was acquired by Cirrus and the L8-D Group on August 1, 2009. The platform has been subsequently refurbished by TAQA Offshore who is managing production operations on behalf of the L8-D Group.

The L8-D field area has been unitised and equity interest partners in the L8-D Group are Cirrus (operator) 25.479 %), TAQA Offshore 15 %), TAQA Licenses Offshore 2.88 %, Energy06 Investments 1.341 %, EWE 13.4 % and EBN 41.900 %.
The L11b-A06 well commenced production on October 4, 2009 and is currently producing at a constrained gross rate of 32.8 mm cfpd although production rates of 37.3 mm cfpd have been tested.

The price received for Dutch gas is based on a basket of alternative energy sources and historically has closely followed that of crude oil with a lag of about 6 months. The realised price for L8-D equivalent quality gas in September 2009 was C$ 8.00 per tcf relating to average Brent prices of approx. $ 45.00 per barrel in March 2009. At a Brent oil price of $ 70.00 per barrel, the future realised price for L8-D gas is expected to be over C$ 9.50 per tcf.
The second appraisal/development well on the L8-D field is currently being drilled from the L11b-A platform using the Nobel Lynda Bossler jackup drilling rig. This well, L11b-A07, is expected to be completed in December 2009.

M7-A Field (Cirrus 42.75 % and operator)
Production from the M7-A field has recently been stable at a constrained rate of 23.5 mm cfpd which is the maximum allowable under the processing agreement with the operator of the L9-FF processing platform. Since production start on September 12, 2009, the M7-A platform and infrastructure has performed to design specification with close to 100 % up time.
Cirrus President and CEO David Taylor comments, "The start-up of the L8-D Field is a significant achievement for Cirrus coming less than a month after start-up of the M7-A field. It is also noteworthy that first production from the L8-D field has been achieved just eight months after the testing and completion of the L11b-A06 well. This achievement underscores our business strategy in the Netherlands which is to establish Cirrus as the pre-eminent junior company in the offshore Dutch gas basin."