Nighthawk Energy has been given conditional approval by Colorado authorities to carry out its water flood programme on the Smoky Hill project.
The programme is aimed at enhancing oil production from the Arikaree Creek oilfield.
The company had to reduce the size of the project to gain support from the holders of royalty interests in the field and requires support for the programme from at least 80% of the holders of the non-cost royalty interest covering the field.
The total potential oil-in-place at the project is around 16.6 million barrels, with the recovery rate at the water flood project expected to be in the range of 30% to 40%.
The reduced project scope is targeting 8.6 million barrels.
“Due to lower actual historical production in the southern part of the field, the pilot has a disproportionately higher share of the remaining oil-in-place. Management is confident that expected required Royalty Owner approval level for the pilot will be met,” said Nighthawk.
“The amendment will be reviewed by the Colorado Oil & Gas Conservation Commission at its June meeting and it is anticipated that an approval will be received at that date,” the company added.