VANCOUVER, BRITISH COLUMBIA--(CCNMatthews - July 10, 2006) - Horizon Industries Ltd. (TSX VENTURE:HRZ), is pleased to announce it has completed a preliminary evaluation of two shut in wells on its 400 acre Funk Prospect in Goliad County, Texas. Horizon holds a 100% interest in both wells.
Two wells were drilled on the Funk lease in 2002. Horizon recently re-entered both wells, the Geogoliad #3 and #4. The wells were cleaned out and Gamma Ray Neutron and Radial Bond logs were run followed by flow tests. The Geogoliad #3 flowed 50MCF per day together with load water with a shut in pressure of 900psi. The Geogoliad #4 averaged 180MCF per day while unloading KCl fluid with shut in pressure of 1125psi. The Geogoliad #4 was drilled through the Yegua formation directly north of a large amplitude anomaly. Seismic profile maps indicate this well was located off the edge of the main porosity. Both wells remain tied in to Duke Energy's pipeline.
The Company is currently awaiting final transfer of all on onsite equipment from the Texas Railroad Commission before opening the wells to sales. A gas sales contract is in place with Duke Energy. Once the wells begin to flow to sales and continue to unload fluids, it is anticipated that production will be enhanced. At the time of the transfer, which is expected within the next several weeks, Horizon will immediately turn the wells to sales. Horizon will then commence preparations to perforate and flow test several other zones identified in the Vicksburg and Frio formations with the intention of further increasing production. Logs from both wells indicate the presence of multiple behind-pipe pay zones, several of which have not been developed. This assessment is supported by Horizon's newly acquired 3D data set over the lease.
Horizon President, Chris Wensley states, "These positive flow tests greatly enhance the potential for our previously identified 3D targets on the Funk lease. Our high quality 3D data combined with well logs and production records gives us great confidence in our future targets and significantly reduces drilling risk. Furthermore, any production we can stimulate from our re-entries and work-overs will help finance our acquisition and drilling plans. It is encouraging to encounter commercial quantities of gas from zones previously believed depleted. We are therefore very optimistic about uphole zones where logs indicate potential reserves behind pipe."
Horizon has commenced a program to farm out up to 50% Working Interest in the prospect and up to 25% Working Interest in the GeoGoliad #3 and #4 wells retaining at least 50% Working Interest in the Funk Prospect and a 75% Working Interest in the GeoGoliad #3 and #4 wells.
The Funk Prospect is located in the G. Barrera survey A-2 in Goliad County and consists of two tracts of land comprising 240 acres and 160 acres. The Funk Prospect is situated in the prolific Middle Yegua gas trend, a formation that has produced gas and condensate in the nearby Maetze Yegua, Perdido Creek and Jobar fields.
The Perdido Creek field is located one and a half miles northeast of the Funk Prospect. Perdido Creek hosts seven producing wells with cumulative production of approximately 3-4 Bcf and 80,000 bbl. of oil and condensate from the Yegua sands. The best well in Perdido Creek, the Vrazel #1 produced 1.8 BCF and 30,000 barrels of oil and condensate from a 90' sand covering 36 acres. These Yegua sands appear to be similar to that underlying the Funk prospect which hosts 2D defined Yegua sand bodies of 35 to 50 acres in aerial extent.
The Maetze Field, is located 3,500 feet to the southeast of the Funk lease. Total production from this field was approximately 5BCF. The best well in this field, the Cron Dreier, drilled in the early 1950's blew out for over six months releasing up to 2 BCF of gas before being shut-in.
About Horizon Industries Ltd.
Horizon Industries Ltd. is an emerging oil and gas exploration and production company building a high quality asset base in focused areas throughout the United States. The Company is currently developing strategic alliances in high impact oil and gas plays in Western Canada. For more information, please visit www.horizonindustriesltd.com.
On Behalf of the board of directors,
Christopher Wensley, President
WARNING: The Company relies on litigation protection for "forward looking" statements. Actual results could differ materially from those described in the news release as a result of numerous factors, some of which are outside the control of the Company.
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