(ASX: EMR) has secured additional funds to fund its share of cost for the 2012 Sandwash Basin well program in Colorado and Wyoming that will start in July.
The company has increased to US$20 million from US$15 million its debt facility with a private U.S. company that was originally used to fund its recent acquisition of Williston Basin assets.
Emerald will also have an additional 3 month to late November 2012 to repay the loan, which is expected to be funded through U.S. capital markets through its U.S. subsidiary.
The company had awarded a small overriding royalty on its Green River Basin leases and up to 46 million shares as consideration for the increase and extension.
The Sandwash program will focus on re-entering several existing wells, including the 3 vertical appraisal wells drilled during 2011, to apply hydraulic fracture stimulations and possibly horizontal laterals with multi-stage fracture treatments that have proven effective in the area.
The program may also include drilling additional vertical and horizontal wells.
Other companies in the area had last year demonstrated the potential of the Sandwash Basin Niobrara shale oil play by applying particular well designs and fracture stimulation treatments to produce oil at rates of several hundred barrels of oil from both vertical wells and horizontal laterals.
Emerald is also participating in the 2012 Green River Basin Joint Venture work program that will focus on re-entering existing wells and applying drilling and completion techniques which have been demonstrated to be successful in wells offsetting the acreage to the south.
Key objectives of this work program will be to establish commercial oil production from Green River Basin wells and to gain further experience with various well completion techniques before planning a development drilling program for 2013.
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