The Meridian Resource Corp., Houston, (NYSE: TMR) reports initial production test results on its Sutton A-574 No. 1 well in Polk County, Texas had daily flow rates as high as 35.4 million cubic feet of gas equivalent per day.

This rate includes 18.6 million cubic feet and 2,800 barrels of oil per day. The well is in Meridian's East Texas Austin Chalk play and has flowing tubing pressure measured at approximately 1,300 pounds per square inch through an open choke. The well was drilled vertically to approximately 12,200 feet then added two horizontal laterals. The first lateral extends approximately 5,200 feet in length, with the second extending approximately 6,500 feet for a total wellbore exposure in the Austin Chalk of 11,700 feet.

The dual lateral well is still in a "clean-up" of drilling fluids phase with intermittent fluctuations normally experienced during the first several day phases of production for wells similarly drilled and produced in the area. Meridian expects Sutton A-574 No. 1 to display similar producing characteristics to other Austin Chalk wells in the area, with the typical hyperbolic decline curve from current production levels during the coming months. Meridian has approximately 63% working interest (42% net) in the well.

The rig that was utilized on this well was moved to drill the dual horizontal BSM A-278 No. 1 well which was spud this week. Additionally, BSM 507 No. 2 in East Texas has reached total depth on its second lateral and is being completed. Meridian expects that the well will be tested before the end of the year.

Meridian has oil and gas operations in Louisiana, Texas and the Gulf of Mexico.