Prairie Provident Resources Announces Operations Update

Executive Summary

• Prairie Provident reported initial production from its first Ellerslie horizontal well in the Princess core area, delivering ~290 boe/d (185 bbl/d heavy oil) with a peak rate of 205 boe/d.
• A new water‑disposal facility at Princess is expected to save roughly $600,000 annually by eliminating water trucking and third‑party disposal fees.
• Two Basal Quartz horizontal wells drilled in the Michichi area suffered casing failures; they are unlikely to be salvaged in their current configuration, prompting a review of drilling designs for that region.

Key Details

• Well 102/03-24-018-11W4M (Princess)
• Spud‑to‑rig release: 12 days
• Lateral length: 3,594 m; 0 fracture stages (open‑hole)
• Initial production period: 30 days
• IP rates (field estimates at wellhead): 131 bbl/d heavy crude oil, 685 Mcf/d natural gas, total 245 boe/d; peak oil rate 205 bbl/d.

• Latest daily production: ~290 boe/d (185 bbl/d heavy oil).

• Water‑disposal facility – Princess

• Installed and commissioned at well 10‑23‑018‑11W4M.
• Includes tie‑in of Pekisko water disposal well 102/10‑23‑018‑11W4M.

• Anticipated annual operating cost savings: ≈ $600,000 (eliminates produced‑water trucking & third‑party disposal).

• Michichi – Basal Quartz horizontal wells

• Two one‑mile laterals drilled from pad 4‑31‑30‑18W4M: wells 03‑30‑30‑18W4M and 02‑30‑30‑18W4M.
• Encountered high‑quality Basal Quartz reservoir (per strip logs).
• Primary cementing resulted in casing collar shearing/deformation at similar depths; downhole camera confirmed failures.

• Company believes failures stem from an oblique slip on critically stressed sub‑seismic faults, a geo‑mechanical event separate for each well.

• Impact Assessment – Michichi

• Standard offset‑well design used (single‑leg cased‑hole).
• Current configuration deemed unlikely to be salvageable.
• Ongoing evaluation of geo‑mechanical implications on future drilling designs in the Michichi area; further operational updates will follow.

Notable Quotes

• “Production continues to increase as the well cleans up… we expect natural gas takeaway constraints to resolve in the near term.” – Dale Miller, Executive Chairman
• “The water‑disposal facility will generate approximately $600k of annual cost savings by eliminating third‑party disposal charges.” – Dale Miller

Materiality Assessment: Non‑Material – Positive (operational update with modest production and cost‑saving information).