Tri-Valley Oil & Gas Co. (TVOG) said Thursday that it has begun farming out working interest units in its Oil Creek play near Coalinga, CA. TVOG said it has mapped a potential of six separate pay zones to 12,500 feet in the exploratory wildcat prospect, which is north along the trend of the giant Kettleman North Dome Field. The company speculates an unproved potential of up to 125 million barrels of oil and up to 375 Bcf of natural gas from the multiple targets. Project costs are estimated in the range of $3.5 million, including drilling and completing the initial test well.

“It’s a wonderfully prospective area where the 1 billion barrels of oil equivalent Coalinga Field was discovered in 1890 by drilling near oil seeps. New technology as well as downhole information from thousands of wells drilled in the area vastly enhances our present search data now,” said Joseph R. Kandle, TVOG president.

The Oil Creek Prospect is located in the middle of a horseshoe-shaped configuration of huge producing oilfields surrounding Coalinga, which have given up nearly 1.5 billion barrels of oil and 887 Bcf of gas, according to TVOG. Just eight miles to the south, Kettleman North Dome has produced 458 million barrels of oil and nearly 3 Tcf of natural gas.

“Oil Creek is typical of the very large target prospects emerging from our California database. Although the odds of failure are high on any exploratory wildcat, we look for big plays where discovery success gives a chance of exceptional reward for our shareholders as well as our drilling partners,” said F. Lynn Blystone, CEO of Tri-Valley Corp., TVOG’s parent company. “Our experience indicates that we can expect a substantial number of risk-tolerant individual and corporate investors to express interest in a project of this magnitude.”

California has had only marginal exploration for the past two or three decades, and TVOG said it believes huge exploration targets may remain in the midst of the nation’s biggest economic unit, which imports more than 55% of its oil and more than 87% of its natural gas needs.

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