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GOLIAD COUNTY, TEXAS
Horizon Industries Ltd. recently acquired a total of 400 acres of land in the Barrera A-2 survey in Goliad County, a part of the 1,800 acre Funk ranch. Gas and condensate has been produced from several wells in the area from the Miocene at approximately 1,500 feet to the Cook Mountain at 5,800 feet. The acreage is broken into two parts. The northern part consisting of 240 acres has the Geo-Goliad #3 and #4 wells which are still capable of production, both having log indicated reserves behind pipe.
In order to fully evaluate the potential of this property, 3D seismic data was purchased. The data revealed gas anomalies in the Catahoula, the Frio and the Yegua formations, some of them having gas production and others significant shows.
Catahoula Formation
Catahoula production is encountered in the area in sands from 2,000' to 2,600'. Porosity varies from 24% to 32% with permeability from 80md to over 500md. Recoverable reserves from the expected depth of 2,100 feet to 2,150 feet are in the order of 350 mcf/ac.ft. The map of the Catahoula amplitude shows the anomaly covering approximately 120 acres. The average thickness for similar sands at this depth in the area is 20 feet. Applying these criteria to this anomaly would produce recoverable reserves of 840 Mmcf.
Frio Formation
The Frio starts at approximately 2,800 feet in this area. Production in the vicinity has been from sands from 2,900 feet to the base of the Frio at 3,900 feet. The 3D seismic data shows several strong gas anomalies some of which have been produced and others that appear to be untouched. The GeoGoliad #3 well produces from this sand at 3,204 feet to 3,412 feet and has produced to date 82Mmcf. Several Frio anomalies have been identified having the potential for commercial reserves.
Yegua Formation
The Funk lease is located within the Maetze Yegua field. This field was discovered in 1956 by the Cron Dreier #1 well. The field produced likely in excess of 5Bcf of gas. Production was revived in the 1980's with several wells having cumulative production of over 1.5 Bcf. The 3D seismic shows three very good Yegua anomalies within the lease having the potential to host very good reserves. Three wells to TD of 6,000 feet are recommended to test and develop these targets.
Cautionary Note to U.S. Investors-The United States Securities and Exchange Commission permits oil and gas companies, in their filings with the SEC, to disclose only proved reserves that a company has demonstrated by actual production or conclusive formation tests to be economically and legally producible under existing economic and operating conditions. We use certain terms on this web site, such as probable and possible reserves, that the SEC's guidelines strictly prohibit us from including in filings with the SEC. U.S. Investors are urged to consider closely the disclosure in our annual Form 51-101, available from us at 1710 - 1040 West Georgia Street, Box 83, Vancouver, BC V6E 4H1. You can also obtain this form at www.sedar.com.
Copyright © 2006 Horizon Industries Ltd. All Rights Reserved.
