Emerald has reached agreement to take up a 25% interest in lease options covering 2,000 acres over the Steamboat Prospect in Jim Hogg County, Texas. The prospect has both shallow (Queen City at 8,500 feet) and deep (Wilcox at 13,000 feet) objectives with potential reserves of 30 Bcf gas and 50 - 100 Bcf gas, respectively. The prospect has been mapped using 2-D and limited 3-D seismic however, additional 3-D seismic will need to be acquired and interpreted prior to it's drilling in late 2007 by a third party(ies). Leases are currently being optioned over this large-potential prospect. Drilling will be subject to participation funding and satisfactory option terms being achieved.
Geology
The Steamboat prospect is a seismically defined crestally faulted rollover structure lying east of the main Wilcox flexure. It is comprised of Queen City, Wilcox Hinnant and Cook Mountain objectives which should be tested with separate wells. An antithetic fault forms a trap for a Wilcox gas accumulation discovered and tested in the mid-1980's. This well tested 3.5 MMCFD without fracture stimulation from a Wilcox Hinnant sand below 12,000 feet. Seismic interpretation indicates the trapping fault for the Wilcox gas accumulation migrates east of the location and should form a similar antithetic trap in a section of well-developed Queen City and Cook Mountain sands. The Queen City sands in the original borehole have petrophysical shows, which were not tested near the pipe point near 8,000 feet. The original borehole is a potential re-entry candidate for the Wilcox Hinnant sands which have a blocky log character and may be a turbidite feeder channel facies, similar the prolific Travis Ward sands.
Project Status: Leasing under way to be followed by farmout of seismic survey then drilling.