N. Midway-Sunset
Berry’s N. Midway assets include Diatomite, Placerita and McKittrick. During 2009, we drilled 51 wells and installed additional steam generation and water treating facilities. Average production in 2009 was 3,100 BOE/D and in 2010 averaged 2,720 BOE/D and was impacted by a suspension of drilling activity as we worked to secure permits from the California Division of Oil, Gas and Geothermal Resources (DOGGR) and conducted field optimization activities prior to resuming. Steam injection, which had been averaging over 30,000 barrels of steam per day (BSPD) earlier in the year, decreased as a result of the facility and infrastructure modifications.
In September 2010, we received approval from the DOGGR for the next phase of development of our Diatomite project, and full project approval appears to be on schedule. The first rig resumed drilling in early October 2010, and a second rig was added in December 2010. Steam injection has steadily increased, and we exited 2010 at approximately 31,500 BSPD. Production from this asset is expected to increase to 5,000 BOE/D by mid-2011 as we continue our development program and continue to increase steam injection.
At McKittrick 21Z, we evaluated the performance of cyclic steam operations and found them to be economic. As a result, we plan to drill 44 McKittrick wells and expand infrastructure in 2011. We intend to focus additional capital investment in 2011 on initiating steam flood pilots at our Fairfield, Pan, USL-12, and Main Camp properties located in N. Midway. Average daily production from all N. Midway assets was approximately 5,320 BOE/D in 2010 compared to 5,480 BOE/D in 2009.
