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pfc announces successful drilling of baldwin-2

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    PetroFrontier Corp. announces successful drilling of Baldwin-2 horizontal well in the Georgina Basin, Australia

    CALGARY, Oct. 11, 2011 /CNW/ - (TSX-V: PFC) - PetroFrontier Corp. ("PetroFrontier") is pleased to announce that it has successfully drilled Baldwin-2Hst1, Australia's first horizontal well in the Lower Arthur Creek "Hot Shale" Formation in the southern Georgina Basin in the Northern Territory, Australia. Baldwin-2Hst1 is located in the southwestern part of EP 103 in the Southern Georgina Basin. PetroFrontier has a 100% working interest in EP 103 and is the operator. EP 103 covers 3.16 million gross acres and accounts for approximately 27.2% of PetroFrontier's net acreage in the Northern Territory, Australia.

    The "Hot Shale" formation is comprised of interbeds of shale, silt, sand and carbonate, is slightly radioactive and is easily identified on gamma ray logging tools. The "Hot Shale" is petroliferous, up to 40 metres thick and extensive in area. The "Hot Shale" is geologically and mechanically analogous to major unconventional oil plays in North America such as the Bakken and Eagleford. These unconventional oil plays require the use of advanced horizontal drilling and completion techniques to be economic.

    Baldwin-2Hst1 reached a total measured depth ("MD") of 1,948 metres and remained within the main target zone in the Lower Arthur Creek "Hot Shale" for 875 metres while directionally drilling up a regional dip of 1.7 degrees. Positive hydrocarbon indications were recorded along the entire length of the horizontal section, with elevated gas readings and evidence of heavier hydrocarbons present.

    "PetroFrontier's long range exploration planning includes accurately defining the regions of oil and gas maturity within the basin to help target our exploration efforts," stated Paul Bennett, CEO of PetroFrontier. "We believe that within our lands the full range of hydrocarbon maturation is present and this will allow PetroFrontier the flexibility to chase the best economics for the play, whether it is pure oil or various mixtures of oil and gas."

    The plot attached is a vertical cross section showing the vertical holes at Baldwin-1 (drilled in 1990) and Baldwin-2, the successful horizontal leg (Baldwin-2Hst1) and the plugged back horizontal section. Baldwin-2Hst1 was kicked off from Baldwin-2 above the field of view in the plot. The color variation along the well path shows the recorded gamma ray log with green indicating low gamma values (sands or carbonates) and blue indicating high gamma ray values (shale). The red values along the well paths show the variation in total gas values.

    Delays in drilling occurred when the bit tracked into the underlying Thorntonian Limestone Formation after encountering an unexpected fault. Every effort was made to redirect the bit upwards back into the Lower Arthur Creek "Hot Shale", but the bends in the hole became too severe for an effective future well completion. The new horizontal section kicked off along the regional dip established by the plugged back portion of the well and was successfully steered through the Lower Arthur Creek "Hot Shale". Total gas recorded in Baldwin-2Hst1 averaged 240 units over the entire horizontal section, commonly peaking above 1,000 units with maximum recorded values over 2,500 units. The gas recorded contained heavier hydrocarbon fractions up to pentane ("C5") over much of the horizontal section. Conventional gas ratio analysis indicates very wet gas to oil for the most of the well with occasional definite oil signatures in places. However, this interpretation may be biased to gas due to the nature of the reservoir being intersected.

    Following the interpretation of the full suite of logs acquired in the pilot hole, a mechanical earth model was constructed with very positive indications for the ability to fracture stimulate Baldwin-2Hst1. Fractures developed in the vertical plane of the well, transverse to the horizontal well path, are predicted by the model, with excellent containment indicated from the bounding layers both above and below the possible pay zone. In addition, natural fractures were observed. These will assist in the initiation of the stimulation fractures and aid in growing the complexity of the fracture treatment. This should have a positive impact on flow rates.

    X-ray diffraction ("XRD") analysis has shown little presence in samples of clay minerals often associated with sensitivity to water-based frac fluids. The XRD results, combined with further confirmation in laboratory sensitivity tests, have given PetroFrontier the confidence to fracture stimulate with water, which is an important factor in keeping the stimulation costs as low as possible.

    Although these findings are encouraging, this well remains a high-risk exploration venture and yet to be proven. Readers are cautioned that no reserves or production has been proven by this well.

    PetroFrontier will suspended Baldwin-2Hst1 and then move Major's TXD-SS2018 rig to the second location in the current program, MacIntyre-2, located in the northeastern corner of EP 127, approximately 60 km to the northwest of the Baldwin location. The rig once released is expected to commence drilling the MacIntyre well in approximately three weeks following minor rig modifications. PetroFrontier has redesigned and re-engineered the MacIntyre-2 well to be drilled as a deviated pilot hole kicking off to a horizontal in the Lower Arthur Creek "Hot Shale". This new well design is expected to result in greater drilling efficiencies and substantial cost savings.

    PetroFrontier will issue its next update once a date has been determined to spud the MacIntyre-2 well.

    Once MacIntyre-2 has been drilled, PetroFrontier intends to frac and complete the well using multi-stage open hole techniques. Final results will then be released from MacIntyre-2 and the completions crew will subsequently return to Baldwin-2Hst1 to conduct a similar completion program there. It has always been PetroFrontier's strategy to frac MacIntyre-2 and Baldwin-2 back to back in order maximize cost controls.

    PetroFrontier intends to use Schlumberger, the Australian representatives of Packers Plus, to run the multistage open hole completion string and conduct the fracture stimulation program. PetroFrontier is the first company to introduce to Australia these open hole horizontal and multi-stage fracing technologies to unlock unconventional oil potential. These technologies have been widely successful in unlocking North American unconventional oil reservoirs such as the Bakken formation. The use of these technologies is expected to give PetroFrontier every chance of establishing commercial production.

    About PetroFrontier Corp.

    PetroFrontier is an international oil and gas company engaged in the exploration, acquisition and development of both conventional and unconventional petroleum assets in Australia's Southern Georgina Basin. PetroFrontier's common shares are listed on the TSX Venture Exchange under the symbol "PFC". Founded in 2009, PetroFrontier is one of the first companies to undertake exploration in the Southern Georgina Basin in Australia's Northern Territory. PetroFrontier's head office is based in Calgary, Alberta and operations office is in Adelaide, South Australia.
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