Thursday, August 7, 2008

Transcript of Forest call related to the Utica

Prepared remarks:

J. C. Ridens - Executive Vice President and Chief Operating Officer

Now, for the New Frontier and exploration program. First off in the Utica shale, we are right on our timeline that we showed at our analyst conference. Due to competitive reasons, we won't discuss anything further about this until probably the fourth quarter, but we are executing just as predicted so far.



Q & A:

Dan Mcspirit - BMO Capital Markets

Gentleman, for the three to four horizontal tests, in the shale, by how much will you vary the lateral links and the completions across those wells?

J. C. Ridens - Executive Vice President and Chief Operating Officer

Our target is starting out for about a 2000 foot horizontal. And frankly, what we will do is we'll see how the drilling is proceeding. And, if we are making really good haul and not seeing any haul problems we'll probably push that little bit, in order to gain some more data on how far you can actually drill the horizontals in the shallow environment. That will also of course determine how many stages back we are going to go with. Initially we're only going to go with about four stages and the reason for that is just simply to gather more data on the rock properties that we see during the simulation, see how effective that is, and typically what we've done is we start off with fewer stages in the initial batches and then as we refine our completions we increase the number of stages. Obviously with a 2,500 foot lateral, we could probably do up to 8 or 9 stages.

Dan Mcspirit - BMO Capital Markets

Right.

H. Craig Clark - President and Chief Executive Officer

Then, the... what we shallow on average depth of the analyst conference of 4000 to 7000 feet measured, the fluctuations not the lateral, it's actually the true vertical depths that range from 2500 to 6000 or 5000 feet. It's not the lateral, it's the true vertical depth because that falls off deeper pretty quickly from North to South.

Dan Mcspirit - BMO Capital Markets

Right, right got it. And these are slick water correct?

H. Craig Clark - President and Chief Executive Officer

Probably couldn't comment at this time since we haven't gotten all the wells down and proprietary reasons but the first frac were some where to Barnett Shale.

Dan Mcspirit - BMO Capital Markets

Got it Okay well assuming there is water involved here, much has been then discussed to play with regard to what are procurement in disposal issues in the Appalachian basins, specifically the drilling of Marcellus wells any issues like that on the horizon?

H. Craig Clark - President and Chief Executive Officer

That one's easy. The St Laurence River was a clinical source and that's where we got our frac water and treated it.

Dan Mcspirit - BMO Capital Markets

Perfect. That's all I got thank you.

H. Craig Clark - President and Chief Executive Officer

Okay thank you

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