Workers drill multi-million-dollar Victoria County oil, gas well
June 30, 2010 at 1:30 a.m.
Work began on a Victoria oil and natural gas well engineers estimate holds $5.8 million in reserves.
Those reserves also represent notable taxes for the county.
The well is part of the Koliba Prospect, a 143-acre lease in the North McFadden Field near Bloomington.
A handful of companies with varying interests in the well began in April preparing the site for drilling. Drilling began in recent days.
"Right now, we are drilling at about two-thirds of our target depth," said Jeremy Driver, president of Strategic American Oil Corporation of Corpus Christi. "Assuming no weather delays, we'd hit our target depth this weekend."
Engineers identified three target depths ranging from 5,000 to 6,000 feet. If all goes well, production could begin within two to three months, Driver said.
The reserves while notable represent a small portion of overall Victoria County oil and gas supplies.
The county in 2009 boasted $155 million in taxable mineral values, said John Haliburton, Victoria County's chief appraiser.
Based on last year's tax rate, the $5.8 million Koliba well would generate $122,000 in taxes for the county, as well as hospital, navigation and Bloomington school districts.
Those taxes will decrease over time as production drains underground reserves.
Phil Albrecht, a Victoria petroleum landman, notes companies already exploited the Koliba Prospect and thus remaining reserves are minimal.
"What they're doing is secondary recovery, getting the scraps that are left behind," Albrecht said.
Texas Railroad Commission records indicate seven wells from the three target zones historically produced 390,426 barrels of oil.
Driver, the Strategic American Oil Corporation president, said current production of remaining supplies could last 10 to 15 years. Production dips dramatically, however, after initially recovery, he said.
"Any of that kind of activity in the region is positive for our local economy," said Dale Fowler, president of the Victoria Economic Development Corp. "You get the tax base plus so many of these people spend money here, rent hotel rooms here in Victoria."