U.K.-based Nighthawk Energy Plc detailed an update on its operations in the Denver-Julesburg Basin in Colorado on June 25 at the annual general meeting.

Based on 2-D seismic in the Monarch area, there were six or seven popup features on structure. There could be as many as nine popup features that could contain 40 or 50 drilling targets.

At least one structure could be similar in size and nature to Arikaree Creek Field, Nighthawk said. A reservoir model of Arikaree Creek was finished, and there is a secondary recovery waterflood solution, the company said. There could be between 12MMbbl and 15MMbbl of oil in place in deeper zones. There could be 25% recoverable oil, implying another 1MMbbl above current estimates. A study confirmed that more oil can be recovered based on waterflood development.

There is the possibility for a 2016 capital project, Nighthawk added.

Initial drilling locations will likely be selected in July after 3-D seismic is interpreted, and drilling is scheduled to begin in September.

There are joint development agreements in the Monarch and El Dorado areas. There are about 70 potential Spergen drilling locations, and 30 to 50 are in the Monarch joint development area.

Vertical well drilling and completion costs are now estimated to be between $1.5 million and 1.7 million per well. The highly economic Spergen type curve has net present value of about $4 million, with oil prices at $60 per barrel (bbl) and internal rates of return between 130% and 160%.

On the regional Mississippian structure, there are now more than 162 square miles of 3-D seismic spanning more than 35 miles.

Nighthawk said that results in all areas depend on rock characteristics and their location in the structures. Locations that will be drilled first are currently being high graded, and seismically constrained reservoir properties and fracture reservoir characteristics are sought.