The Lower Cretaceous Muddy Sandstone and Newcastle Sandstone oil plays are developed in a suite of stratigraphic traps related to the depositional environments of the reservoirs (Ref: Dolton and others, 1990). The reservoirs along the eastern edge of the Powder River Basin are interpreted as alluvial and estuarine deposits filling channels incised into the underlying marine Skull Creek Shale (Ref: Stone, 1972). This productive trend is predominantly northeast to southwest and major fields include Fiddler Creek, Fiddler Creek East, Osage, Clareton, Skull Creek and Mush Creek. Production from these six fields through 1991 was over 74 million barrels of oil and 5 billion cubic feet of gas (Ref: Wyoming Oil and Gas Conservation Comission, 1992).
On the LAK Ranch property, oil is located in the Upper Marine and Lower Channel sequences of the Newcastle Formation. These sequences are separated by a thin shale unit. Across the mapped area of the property, the Newcastle Formation (upper and lower sandstones plus shale) varies from zero to 100 feet in thickness. The structure on the property is a west-southwest plunging syncline (bowl-shaped structure). The Newcastle Formation outcrops on surface on the northeast portion of the property and plunges to depths of about 2500 feet on the western property boundary. Oil is currently being produced from the Newcastle Formation at depths of approximately 1100 to 1200 feet at the pilot operation.
Production from the Newcastle Sandstone has totaled approximately 9700 barrels of oil since Ivanhoe Energy took over as operator. Since Ivanhoe commenced continuous steaming operations in October, 2005 daily production has risen to average between 45 and 50 barrels of oil as of March, 2006.
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