DENVER, CO, Oct. 4 /CNW/ - Kodiak Oil & Gas Corp. (AMEX & TSX Venture: G), an oil and gas exploration and production company with assets in the Green River and Williston Basins, today provided an interim operations update on its 2006 drilling program in the Williston Basin in Montana and North Dakota. Williston Basin - North Dakota and Montana ------------------------------------------ Bakken Prospect - McKenzie County, ND ------------------------------------- Kodiak recently completed drilling operations on the Grizzly Federal No.4-11H well (62.5% WI - Kodiak operated), its second Bakken well. These lands are located on the Montana - North Dakota state line. Three laterals were drilled in the well with a total of 10,215 feet open in the Bakken Formation. Pre-perforated liners have been run into each of the laterals. The well is expected to be on production by mid-October and will be produced initially without artificial lifts and stimulation. Two miles directly east, the Grizzly 13-6H well (62.5% WI - Kodiak operated) is producing from a dual-lateral well with 7,629 feet open in the Bakken Formation. In an effort to draw down reservoir pressure before stimulation work, the well was placed on production in late July 2006 flowing naturally without pump at an initial rate 115 barrels of oil per day (BOPD). The well's production dropped off over the following 30 days to 40 BOPD and was placed on pump in late September. Initially the well pumped in excess of 160 BOPD and is currently producing 60 BOPD. Stimulation procedures are scheduled for the third week of October which should increase production from the well. Kodiak is rigging up to drill the Grizzly Federal No.1-27H well (62.5% WI before payout, 51% WI after payout- Kodiak operated) two miles north using the same drilling rig. The drilling block for this well encompasses two stand-up 320-acre tracts and a 9,000 foot lateral well bore in the Bakken Formation is projected for the drilling program. Estimated drilling time for the well is 45 days with drilling and completion costs net to Kodiak of $2.7 million. Mission Canyon-Sheridan County, MT ---------------------------------- Recently, Kodiak completed its interpretation of the 3-D seismic program that was shot immediately west of the Company's producing Lowell Field. Based upon this work, Kodiak has identified a seismically controlled location where the Company believes both the Mission Canyon Formation, at an approximate depth of 8,000 feet, and the Red River Formation, at an approximate depth of 11,000 feet, can be evaluated. Seismic interpretation has initially yielded what the Company believes to be several high-quality potential locations which may be evaluated depending on the results of its drilling. The first seismically identified location is currently being permitted (Kodiak 50% WI- Kodiak operated). The Company intends to move the rig to this location from the Bakken play when drilling is completed. Drilling is scheduled for late fourth quarter 2006. Kodiak's share of estimated drilling costs is $1.25 million. Red River-Divide County, ND --------------------------- Kodiak has installed a pumping unit on the Pederson No.14-9H (43% WI- Kodiak operated) which was drilled in late 2005 to evaluate the potential of the Red River "C" Formation. The well is currently pumping five to 10 BOPD (90% water cut) and current plans are to pump the well over the next several months to determine if the oil cut increases. Reinterpretation of 3-D seismic completed in early 2005 is complete with additional potential locations identified. Kodiak intends to allocate part of its 2007 CAPEX for exploration work in the play. Management Comment ------------------ Commenting on the drilling operations, James Catlin, Kodiak's COO said: "Our Bakken results have met our initial expectations. Based upon early results, we believe this program will help the Company to increase its production and cash flow during the later part of the fourth quarter as the wells are stimulated and placed on production. We have drilled our three initial locations in the play, but we believe that the results to-date provide us with additional opportunities in 2007." About Kodiak Oil & Gas Corp. ---------------------------- Kodiak Oil & Gas, headquartered in Denver, is an independent energy exploration and development company focused on exploring, developing and producing oil and natural gas in the Williston and Green River Basins in the U.S. Rocky Mountains. For further information, please visit www.kodiakog.com. The common shares of the Company are listed for trading on the American Stock Exchange and the TSX Venture Exchange under the symbol "KOG." Forward-Looking Statements -------------------------- This press release includes statements that may constitute "forward-looking" statements, usually containing the words "believe," "estimate," "project," "expect" or similar expressions. These statements are made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. Forward-looking statements inherently involve risks and uncertainties that could cause actual results to differ materially from the forward-looking statements. Forward looking statements are statements that are not historical facts and are generally, but not always, identified by the words "expects," "plans," "anticipates," "believes," "intends," "estimates," 'projects," "potential" and similar expressions, or that events or conditions "will," "would," "may," "could" or "should" occur. Information inferred from the interpretation of drilling results may also be deemed to be forward looking statements, as it constitutes a prediction of what might be found to be present when and if a well is actually developed. Forward-looking statements in this document include statements regarding the Company's exploration, drilling and development plans, the Company's expectations regarding the timing and success of such programs. Factors that could cause or contribute to such differences include, but are not limited to, fluctuations in the prices of oil and gas, uncertainties inherent in estimating quantities of oil and gas reserves and projecting future rates of production and timing of development activities, competition, operating risks, acquisition risks, liquidity and capital requirements, the effects of governmental regulation, adverse changes in the market for the Company's oil and gas production, dependence upon third-party vendors, and other risks detailed in the Company's periodic report filings with the Securities and Exchange Commission. The TSX Venture Exchange does not accept responsibility for the adequacy or accuracy of this release. %SEDAR: 00007900E