Nighthawk said its Steamboat Hansen 8-10 well produced more than 22,000 barrels of oil in testing from November to February. It was the first well drilled in the Denver-Julesburg basin in eastern Colorado in more than 25 years.
The U.S. Energy Department says crude oil production in Colorado rose 64 percent from 2007 to 2011. The state may have as much as 2 billion barrels of oil.
Nighthawk said an independent analysis of the Steamboat Hansen discovery in the Smoky Hill prospect estimated the reserve potential at 14.5 million barrels of oil.
Nighthawk Chairman Stephen Gutteridge said the company has plans for further exploration of the area this year.
"With the $5 million additional funding available, we will be able to move quickly to commence drilling," he said in a statement.