TriAxon is an established and successful operator in the Bakken Formation in southeast Saskatchewan with a focus on developing low permeability reservoirs with horizontal, multi-stage fracture stimulated wells. The new farm-out agreement with TriAxon reflects Ryland’s strategy of bringing in experienced industry partners with capital and technical expertise to participate in the exploration and development of the Company’s 389,000 acres of petroleum and natural licenses and leases in Southeast Saskatchewan and North Dakota.
In addition to entering into the new farm-out agreement, Pebble and TriAxon have amended the earning provisions in their 22 section farm-out agreement entered into in October of 2008. TriAxon has earned the Bakken rights underlying five sections by drilling a second test well under that agreement, after its initial well had to be abandoned for technical reasons. Pursuant to the amending agreement, TriAxon will earn 17 sections (as opposed to 11 sections) if it drills a third well as a horizontal well. In addition, the spud date for the third well has been extended to January 31, 2010 so as to follow the two test wells to be drilled pursuant to the new farm-out agreement. TriAxon’s second test well completed under that farm-out agreement has very recently been put on production at approximately 90 BOPD with an increasing oil cut trend.
RYLAND OIL CORPORATION
Gerald J. Shields, President
Issued and Outstanding: 193,576,106