RE: Nitrogen Cost!7 Jun 2018 11:43
Lets hope its a big reservoir with flow rates, nitrogen purity and other reservoir characterization data.
The Company intends to commence drilling operations at the location within the next two weeks. If successful in proving the nitrogen resource, Highlands has the opportunity to become a low-cost nitrogen producer and, most importantly, would secure nitrogen supplies for the Company's proprietary DT Ultravert technology. The discovery could also position Highlands to be a nitrogen supplier across a range of industries.
Prospect Detail and Development Plan
Highlands' nitrogen target in Kansas has been secured following extensive prospecting and geologic research undertaken by the Company's technical staff. Whilst the next step is exploratory drilling with the consequent uncertainty that entails, the opportunity in Kansas has been very cost effective and, as explained below, the upsides are considerable.
Highlands will drill a vertical well to a depth of approximately 3,150 feet, perforate multiple zones and, if successful, hopes to achieve sustained large quantities of long-term nitrogen flow rates from the first well. Based on the project modelling carried out by the Company's technical staff, one well could potentially supply much of DT Ultravert's nitrogen needs. In addition to flow rate, nitrogen purity is another important factor and, based on the prospect's geologic model, Highlands believes it is possible to achieve a highly profitable level of purity. To put the project into context, if successful, Highlands could potentially supply nitrogen for both its own DT Ultravert operations as well as third party uses.
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