StockGuru Blog: Triangle Petroleum Corporation HAS A MASTER PLAN!

TPLM – Triangle Petroleum Corporation
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Shale Gas Drilling About as HOT as it Gets.

Triangle Petroleum is involved in Barnett Shale properties for gas drilling in Texas and has one producing well in this shale. Technology has impacted shale gas drilling. The new rigs are simpler and faster to operate. North American gas market prices are higher than five years ago, and oil and gas development programs reward higher-priced exploration with lower royalty payments on successful wells.Domestic production of conventional natural gas — the stuff that’s cheap and easy to get out of the ground — has peaked in Canada and the United States, and both nations are moving to develop more expensive sources of gas.

The first horizontal well is located in Johnson County and tests the potential for Barnett productivity south and to the east of the established production in this County. The well was drilled earlier this year, fracture stimulated in April and flow tested in order to recover the stimulation load fluid prior to achieving gas production. Initial gas production flow rates of 2.9- 3.0 MMcf/d were established. The well is currently flowing into production facilities at rates in excess of 2.5 MMcf/d. It is expected that production declines will occur from this excellent starting point and follow a profile that has been observed in other commercial Barnett wells.– Three additional horizontal wells have been drilled in northern Hill County. The wells have been hydraulic fracture stimulated and are currently in the early flowback phase of the completion program. This program has been designed to evaluate the effectiveness of closely spaced horizontal wells. It is anticipated that production rates this fall should be enhanced by the geometry of the wells and the procedures used to stimulate these wells.

– A ten square mile 3-D seismic program has been acquired and processed covering a significant land block held by the joint venture group in eastern Hill County. Efforts to interpret the seismic in this structurally more active and complex area are continuing. Drilling plans will be determined at a future date pending a clearer understanding of the seismic interpretations and potential drilling challenges.

Mr. Ron Hietala, President of Triangle USA, comments “This is our first producing well and we look forward to increasing production from our other projects. We are actively seeking other projects in the Fort Worth Basin which have short term drilling and completion requirements due to pending lease expiries, equipment shortages and capital commitments beyond the scope of the projects’ partners. In addition, opportunities in similar basins are currently under evaluation and will be announced once completed”.

Barnett Shale Drilling Expansive and Productive Statewide:

In the Barnett Shale and statewide 156 rigs were working in the Barnett Shale in Wise, Denton, Tarrant, Johnson, Hill, Parker, Erath and Bosque counties, up from 138 just a week earlier and double the total of mid-2005. Statewide, the rig count in mid-July was 748, up from 619 a year earlier.Nationally, the land rig count was 1,553, up from 1,273 a year ago and far from the low of 499 recorded in April 1998. According to Baker Hughes Co. of Houston, which issues the count each week, 1,368 of those rigs were drilling for natural gas.

The optimism expressed by gas drillers’ continued expensive and heavy drilling for natural gas in the Barnett Shale and elsewhere would appear to fly in the face of common sense given the recent drop in prices.

Analysts and government forecasters, who missed on forecasts of record prices during last winter’s heating season, now are suggesting that homeowners will get a break this year with lower natural gas prices.

The U.S. Department of Energy, noting the presence of 2.6 billion cubic feet of natural gas still in storage that largely went unused during the exceptionally mild winter this past year, says natural gas will stay below $7 for most of the rest of the year.

The drop in natural gas prices hurt the stocks of the producers this year, even as most have reported the same record or near-record profits as other energy companies.

But the market future prices indicate that the dip in natural gas prices is an aberration and that the price is likely to rise to $9 per thousand cubic feet by next spring.

The reasoning is that the overhang of surplus gas now in storage will be used up, either by electrical utilities needing more gas for their generators to meet summer air-conditioning demand during the next two months or by gas utilities calling on the extra supply to meet a more normal cold winter beginning in November.
Drilling capability:

Calgary based Crest Energy Consultants has been engaged by Elmworth to design and supervise all phases of the drilling and completion programs for the company in Canada.

Projected Quarterly Milestones

August 2006 to October 2006

• Continue to evaluate Canadian winter drilling programs
• Continue to evaluate the Barnett Shale project
• Continue evaluating new complementary shale gas projects
• Establish limited initial production base

November 2006 to January 2007

• Commence Canadian drilling program
• Commence drilling second well in the Hunter Energy program
• Continue evaluating and drilling wells in shale gas projects
• Continue evaluating new complementary projects and companies
• Expand upon initial production base

February 2007 to April 2007

• Continue Canadian drilling program
• Continue drilling wells in shale gas projects
• Commence drilling third well in Hunter Energy program
• Continue evaluating new complementary projects and companies
• Continue to increase production base

May 2007 to July 2007

• Plan for next stage of Canadian drilling program
• Continue drilling wells in shale gas projects
• Evaluate results of the Hunter Energy drilling programs
• Continue evaluating new complementary projects and companies
• Continue to increase production base

Stay tuned as we examine the hot Canadian Properties Triangle Petroleum has as well.

Sergei Stetsenko, President/CFO
Source: Triangle Petroleum Corporation
Suite 1110
521 – 3 Avenue Sw
Calgary, BC T2P 3T3
Phone: (403) 262-4471
Website: http://www.trianglepetroleum.com.