Zephyr Energy has signed an amended cooperation agreement with the U.S. Department of Energy and its National Energy Technology Laboratory securing an additional $1 million in non-dilutive research grant funding.
These funds will be utilized for data gathering purposes during the ongoing drilling of Zephyr’s State 36-2 LNW-CC well in the Paradox Basin, Utah, U.S.
Zephyr initially received a total of $2.1 million in U.S. government-backed research grant funding for operations at its State 16-2 well in 2020 and 2021. Since then, Zephyr’s technical team has worked closely with the research project team which is led by the University of Utah’s Energy & Geoscience Institute (EGI) in collaboration with the Utah Geological Survey (the UGS) and other Utah -based partners. The project funding continues to be sponsored by the U.S. Department of Energy and its National Energy Technology Laboratory (DOE).
The objective of the additional funding is to acquire further geological data to assist in the understanding of the Cane Creek reservoir and the additional reservoirs overlying the Cane Creek reservoir.
The additional funds granted to Zephyr will be used to fund a Distributed Acoustic Sensor (DAS) fiber in the lateral portion of the well in order to evaluate the stimulation and any post-stimulation fluid production. This will assist Zephyr and the EGI with understanding frac geometry and will latterly measure inflow rates along the horizontal part of the well.
Funds will also be used to deploy QuadCombo and lithoscanning logging tools, to further evaluate the shallow Paradox Formation, and the C9 clastic zone in particular.
Zephyr will also use the funds to obtain additional cuttings for use in fracture analysis, and to acquire the data during the ongoing drilling operations on the well and will have full access to the results of the research project, which are expected to provide significant insight into both the Cane Creek and overlying reservoirs.
The Board hopes the results will materially assist Zephyr in its efforts to maximize the chance of success and optimize efficiencies with future well planning and drilling operations, especially in relation to planned exploration drilling in the overlying Paradox Formation exploration zones and the C9 reservoir zone in particular.
“I am delighted to announce the award of this incremental research funding, the results of which are expected to further enhance our technical understanding of the Cane Creek and overlying reservoirs. The expected output from this analysis will assist with future well planning and drilling operations, particularly in relation to the C9 overlying reservoir, as we look to unlock further value from our Paradox project,” Colin Harrington, Zephyr’s Chief Executive, said.
“I would like to thank the DOE, the EGI, and the UGS for their continued focus and investment in the Paradox, and we are excited to be further aligned with their respective organizations,” he added.
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