page 1
page 2
page 3
page 4
page 5
page 6
page 7
page 8
page 9
page 10
page 11
page 12
page 13
page 14
page 15
page 16
page 17
page 18
page 19
page 20
page 21
page 22
page 23
page 24
page 25
page 26
page 27
page 28
page 29
page 30
page 31
page 32
page 33
page 34
page 35
page 36
page 37
page 38
page 39
page 40
page 41
page 42
page 43
page 44
page 45
page 46
page 47
page 48
page 49
page 50
page 51
page 52
page 53
page 54
page 55
page 56
page 57
page 58
page 59
page 60
page 61
page 62
page 63
page 64
page 65
page 66
page 67
page 68
page 69
page 70
page 71
page 72
page 73
page 74
page 75
page 76
page 77
page 78
page 79
page 80
page 81
page 82
page 83
page 84
page 85
page 86
page 87
page 88
page 89
page 90
page 91
page 92
page 93
page 94
page 95
page 96
page 97
page 98
page 99
page 100
page 101
page 102
page 103
page 104
page 105
page 106
page 107
page 108
page 109
page 110
page 111
page 112
page 113
page 114
page 115
page 116

year-round flow. As the field begins to deplete, we capture more gas than our competitors, and in a field like this, with competitors drilling nearby, it becomes an issue. So we’re proud of having put it all together.” Operating costs are kept as low as possible, and a small company owning its infrastructure has strategic aspects. Ironhorse ships its Shackleton gas into a major sales line, TransGas, which runs just south of its property. “Since we own our processing, which is a major cost for a gas company, we retain that 25- 28 percent return usually built into the cost of construction. We can also control costs by compartmentalizing—our gas plant is situated in an area that can hold six compressors; we currently have two, we’re adding a third this winter, and the operation can scale up as needed, without having to pay up-front for complete construction. These elements, based on a strategy of cost minimization, allow us to weather volatile revenue periods that are influenced by the price of natural gas.” In the spring of 2005, Ironhorse acquired the “Overall we’re developing a critical mass that we think is necessary for excellent return on investment, our ultimate goal” 50 January 08

with gas in Shackleton due to ready access. Oil has recently seen a run-up commoditywise, and it’s expected to maintain or slightly increase, especially with overseas demand. “So we think oil has good promise, but we focus on return on investment. We’ve been looking at Pembina since 2004 and it’ll be 2008 before we get into it. That lead time allows us to learn from competitors in the area. “Mishow was discovered in 2006. Seismic surveys indicated promise there, and when a nearby competitor had drilling success, it provided us with information and impetus to evaluate our own property more closely. Pembina could produce 1,000 barrels daily for Ironhorse, doubling our current production. Overall we’re developing a critical mass that we think is necessary for excellent return on investment, our ultimate goal.” January 08 51 signifi cant and undeveloped oil fi eld acreage at Pembina, west of Edmonton. The Pembina Nisku fi eld is a fairway that runs from the southwest to the northeast over four townships, and the company has land in three concentrated areas, the largest near Violet Grove and Mishow Creek. “Our fi rst focus is on Mishow,” he says. “We’re looking at two wells, offsetting a discovery, all based on 3-D seismic surveys. We think we have a look-alike to the well discovered by a competitor, which had 65 feet of oil pay and will likely yield up to 1.8 million barrels just from one well. We’re looking to capture similar sizes; in the area we’ve identifi ed six locations, and if successful we’ll continue to see more wells. It’s not risk free, but the resource and return on investment is impressive enough.” In the long term Ironhorse is looking for a balance of oil and gas discoveries, but began IronhorseOil&Gas