[nrj]

Striking oil twice?
The ghosts of Desdemona's first boom may be stirring as drillers try to bring the
field back from the dead
By Dan Piller, Star-Telegram Staff Writer

DESDEMONA -- More than eight decades after the end of the Eastland County oil boom
that made Fort Worth a major oil city, Fort Worth may return the favor.
Cano Petroleum of Fort Worth this year paid $8 million for 100 percent of the mineral
rights in a 10,300-acre tract in the southeast corner of Eastland County surrounding the
town of Desdemona, population 150. The company will use new technology to bring the
fields back into production. That was made feasible by oil prices that have tripled in the
past three years.
The Desdemona Field isn't much today. Each of its 70 producing wells yields about two
barrels of oil per day. And that's with new technology recovery efforts. The Texas
Railroad Commission's field report shows 16 barrels produced by the field in all of 2004.

[..]

The boomers thought the oil was gone. They didn't know that between 40 million and
100 million barrels of 41 gravity oil, the famed light, sweet crude that made Texas
synonymous with oil production in the 20th century, was still settled in the sandstone
about 2,700 feet below Eastland County.

Recovery
To get at that oil, Cano Petroleum will do something called " tertiary recovery," hoping to
generate between 7,000 and 15,000 barrels of oil a day from a field that produced 20,000
barrels a day at its peak.

Cano's affable president, Jeff Johnson, uses less-technical terms to describe what the
company will do.
" We're like the company that says, 'We buy ugly houses,' " Johnson said as he gazed at
several pump-jack rigs sitting on wells that are more than 80 years old. " This field is a
fixer-upper."

A lot of fixing up is going on in Texas oil fields these days. Much of the venerable
Permian Basin is being reworked by new owners willing to take risks in old fields, some
of which have been producing since the 1930s. They're doing secondary and tertiary
recovery because the days of the wildcat gushers, like that on Joe Duke's land near
Desdemona, are over.

Johnson points to the intense interest generated in Texas by the big Barnett Shale natural
gas play surrounding Fort Worth.
" In two or three years, secondary and tertiary recovery will be as big in Texas fields as
the Barnett Shale is right now."
Surprisingly, at Desdemona the fixing doesn't necessarily have to be in the casing pipe or
cement that was installed in the wells more than three-quarters of a century ago.

" You'd be surprised at how little needs to be done to the structure of the well borings,"
said John Lacik, Cano's director of operations.
Similarly, Johnson sees little need to do expensive 3-D seismic imaging, the technique
that modern-day oil and gas explorers use to see formations thousands of feet below the
surface.

" Nah, we don't need it," Johnson said. " The old well records are good. Some of these
wells pumped for 70, 80 years. They kept good records. We know what's down there."

What Cano plans to do is inject up to 20,000 gallons of water a day into the wells. The
water will be made soapy by adding alkaline, surfactant and polymer chemicals. The
water will course through the oil-soaked sandstone, forcing the oil into the well bore.
Fort Worth Star-Telegram/Page 3
" The rock is like a sponge, filled with oil," Johnson explained. " The water will squeeze it,
forcing the oil out."

The familiar pump jack -- unavailable during the 1918-22 boom -- on the surface will
then suck the oily water to the surface and into pipelines to separator units. Those units
will do the actual completion of what even the most scientifically challenged mind
knows: Oil and water don't mix.
" I can get the water pretty easily because all of the producers in the Barnett Shale are
pumping up a lot of water with their gas, and I'll pay 25 cents per barrel for their used
water," Johnson said.

So focused is Cano on oil that Johnson isn't interested in the Barnett Shale formation
another 4,000 or so feet below the Duke Sandstone. The Barnett Shale, bending around
the north, west and south sides of Fort Worth, has become the nation's hottest new natural
gas field -- and Texas' largest producer -- in the past two years.
" We're strictly crude oil producers," Johnson said. " We've worked over two old fields in
Oklahoma and learned some lessons. Now we want to try Desdemona."

Out of gas
Johnson's plans for Desdemona aim to solve an 83-year-old problem that virtually closed
down the famous field: What caused the Desdemona Field to abruptly lose pressure back
in 1922?

The answer, says Greenhaw, is natural gas.
" Back then, drillers didn't understand that the natural gas that came with an oil well was
what gave it the pressure that pushed the oil to the surface," he said.