Bell #2 Natural Gas Well Updates

Bell #2 Flow Test Movie

21 August 2006 -  The pipeline has been completed and is finished!! The production equipment and the gravel pad are in place.

On 15 August, 2006, we put the Bell #2 well on production. The is producing at 500 MCF per day; that's equal to 500,000 cubic feet of natural gas per day. The gas is flowing through a less than a 1/8 th inch choke at 2160psi. If you remember from my last update letter, the shut-in pressure was 2150psi. The well has hot decreased in pressure, but has increased to “clean it's self up”. This shows a strong well.

We are going to keep the production rate at around 500 MCF a day for awhile in order to see how the well does. We could eventually open the choke up, along with dropping the pressure down 5% to 1950psi, which will then increase production.

7 June 2006 - With Halliburton Cementing Services, we have cemented the 4-1/2-inch casing. This is done by pumping the cement down the center of the casing followed by a rubber plug being pumped down with water. This then forces the cement out the bottom of the casing and up and around the outside of the casing so it is cemented to the earth. The well is now “behind pipe”. We then installed the wellhead on top of the casing, cleaned out the mud pits, and released the rig.

Next week, we will run a Cement Bond Log, a Neutron Log, and a Collar Locator Log.

Approximately a week after that, we will get a work-over rig to run tubing into the well and install the rest of the wellhead, which is known as a Christmas Tree. After that, Halliburton will be brought back out with a wireline truck to perforate the deepest gas sand and flow-test it. We will then be able to start installing the pipeline, gas production equipment, and meter. In all, this should take a month or two before gas sales begin.

28 April 2006 - I was at Ensign Drilling today and talked with Larry Larson, their West Coast Vice President. He said we were third inline for rig 503 as soon as the ground dries out in Winters, California . This should put us starting to drill the Bell #2 well around the last week of May 2006. The latest 10-day weather forecast for Winters, California looks good.

The farmer at the Bell #2 location confirms that the temperature today is 80° and the wind was blowing. This is what we need to dry out the ground from all the recent flooding.

We will keep you informed as to when we are ready to “rig up” and also how to get daily drilling reports for the Bell #2 off the internet once drilling begins.

05 April 2006 - With our scheduled drilling date of April 7, 2006 for the Bell #2 Natural Gas Well Project quickly approaching, we are challenged with the forces of Mother Nature. Regrettably, the severe weather conditions in Northern California are working against us. Today's weather forecast for Winters, CA is heavy rain showers for eight of the next ten days. You can check the www.weather.com website for Winters, CA forecasts. Since the ground is now so saturated, we will need two to three weeks of dry weather before Ensign U.S. Drilling can move the big, heavy drilling rig onto the location and rig up safely. We apologize for the delay. We are as anxious as you are to begin the drilling of the Bell #2 in the Winters Gas Field so we will keep you up-to-date.

06 March 2006 - In regards to the drilling date on the Bell #2 Natural Gas Well project in Winters, CA, our engineer and the drilling contractor have gone out to inspect the location. They have reported back that the ground is still too saturated with water to safely rig up the heavy drilling rig. They are estimating, if the weather cooperates, that the ground will not be dry enough until at least the second week of April 2006. Currently it is raining in Winters, CA; It looks as though it will be a wet March according to the long range forecast.

04 Jan. 2006 - The location is built and permitted for the Bell #2 Gas Well in the Winters Gas Field. We have drilled 40-feet and set conductor pipe. We have a drilling contractor that can drill the 5,300 –foot well as soon as the ground is dry enough to support the weight of the rig. Heavy rains have saturated the ground and it is unsafe to rig up right now. By the end of March, the ground should be dry enough to rig up and start drilling the Bell #2 well.

The Bell #2 well is supported by geology and 3-D seismic for natural gas.