SERVICE SECTOR / J&L Capital Venture Corp. - Update on Cancoil
Technology Corporation
ASE SYMBOL: JLX
MAY 20, 1998
CALGARY, ALBERTA--J & L Capital Venture Corp. reports the
following updates to the press release dated March 26, 1998, in
which it announced a "Letter of Intent" for the purchase of
certain assets of Cancoil.
Lee Tool, Division of Schlumberger Canada Ltd. has confirmed the
association of Lee Tool Logging Systems and the Cancoil Coiled
Tubing Rig will have the potential to reduce the current industry
costs for horizontal logging operations, thus making the service
more attractive for Oil & Gas companies. Horizontal wells are a
growing part of the oil & gas industry. New technology to
increase the efficiency and reduce the cost of servicing these
wells is long overdue.
Lee Tool and Cancoil believe optimizing the rig-in time and
reducing the operational costs through the utilization of the
advanced "leading edge" Cancoil rig design would increase the
number of wells that oil & gas companies log. The industry has
tremendous potential for growth in the area of horizontal logging
and Cancoil has addressed the logistical mobilization issues
hindering the Coiled Tubing Logging servicing industry, making the
logging package and performance more attractive to oil & gas
companies. Typically oil & gas companies log only problematic
horizontal wells, however now that more economic technology is
available, clients will be more willing to log horizontal wells to
gain an understanding of the reservoir or to evaluate stimulation
techniques. Typically, a conventional rig in for Coiled Tubing
Logging today could take as much as two days with a substantial
amount of equipment. Cancoil has integrated the rig in to be
conducted in a matter of a couple hours with substantially less
equipment and manpower required on location. In summary, the
technology made available through Lee Tool and Cancoil has the
potential to expand the horizontal well logging market.
Cancoil is planning on installing the Lee Tool computer hardware
into the rig control cabin in early July. The logging tools are
ready for operation and will be added to the rig as required in
August.
Radius, Inc., a Houston, Texas based directional drilling company
has agreed to exclusively supply Cancoil with the "leading edge"
directional wireline drilling tools. The Bottom Hole Assembly
(BHA) being supplied by Radius is the first of it's kind with
respect to being substantially cost effective and very small and
versatile. The surface computer hardware for the BHA will be
installed into the Cancoil control cabin in June. The first BHA
will be available at the end of July. The BHA is less then 30
feet in length and has the ability to provide direction,
inclination and gamma ray on mono cable. The first string will be
hydraulically orientated with a patented new orientation tool.
The system is much more economical to build maintain and operate
than current industry systems. Radius and Cancoil are confident
the ability to drill underbalanced with a system of this nature
will ultimately create a large client base and generate endless
opportunity for coiled tubing underbalanced directional drilling.
Currently, the directional drilling systems available in the
industry today require at least one full day to rig-in. Cancoil
will be able to mobilize quickly and rig up is estimated to be
very effective, less then two hours. Minimizing the logistics for
an underbalanced directional drilling rig up will reduce the well
costs substantially, making the technology more attractive for oil
& gas companies.
Newsco Directional & Horizontal Services Inc. has agreed to
recommend Cancoil to their existing oil & gas clients for future
directional underbalanced coiled tubing drilling once all the
equipment becomes available and is fully operational in late
August.
Cancoil has received letters of interest from substantial oil &
gas companies in Calgary as well as internationally. Cancoil
continues to build and prepare the first unit for a field
application. The manufacturing timeline is on schedule.
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