HOUSTON, TEXAS--(Marketwire - June 19, 2012) - CUB Energy Inc. ("CUB", or the "Company") (KUB.V), an upstream oil and gas company, today provides update information on its Eastern Ukraine activities in the Makeevskoye, North Makeevskoye and Olgovskoye License areas, each of which are operated by KUB-Gas LLC ("KUB-Gas"), a subsidiary in which CUB has a 30% effective ownership interest.
-- M-21 well tested natural gas at a rate of 3 MMcf/d;
-- NM-1 drilled to a depth of 2,500 metres and cased to TD after log and
drilling information indicate 4 potential hydrocarbon-bearing zones;
-- North Makeevskoye 3D seismic survey acquires 225 square kilometres of
new data - processing underway with interpretation to be completed by
-- O-14 well suspended and being evaluated as a potential candidate for
The Makeevskoye-21 ("M-21") well was drilled to a total depth ("TD") of 2,210 metres in the first quarter of 2012. Two potential hydrocarbon-bearing zones were identified and the well was cased to TD to enable future testing. The first zone, the R8 zone which correlates with the gas producing zone in the M-19 well, has been perforated and flowed natural gas at a test rate of 3 million cubic feet per day ("MMcf/d") (.9 MMcf/d net to the 30% interest of CUB) on an 8 millimetre choke. The well is expected to be tied-in for commercial production late in Q3 2012. Once tied in, the Company will evaluate testing of the B zone. As a result of the successful testing of the R-8 zone, M-21 well and the consistently high production rate from the Makeevskoye-19 ("M-19") well, the drilling program for 2012 is being revised to bring forward the timing for the drilling of the Makeevskoye-20 ("M-20") well.
North Makeevskoye Exploration Well
The North Makeevskoye-1 ("NM-1") exploration well, which commenced drilling on 5 May 2012, has been drilled to its planned TD of 2,500 metres, wireline logged and cased to TD. Evaluation of both the wireline logs and information obtained during the drilling of the well indicates potential for hydrocarbon accumulation in 4 reservoir units in Bashkirian and Serpukovian aged sediments. Two reservoir units are within a 70 metre thick limestone interval and another appears to be a 30 metre thick sandstone. Production testing of the NM-1 well is expected to take place early in Q3 2012. The drilling rig will start moving to the M-20 location shortly and the M-20 well is expected to spud in mid-July.
North Makeevskoye Seismic
During the second quarter of 2011, KUB-Gas acquired 71 kilometres of new 2D seismic data over the North Makeevskoye Licence. Interpretation of this new data in combination with approximately 275 kilometres of pre-existing 2D seismic data resulted in NM-1 being defined as the first drilling location on this new licence. In the first quarter of this year 225 km2 of new 3D seismic data was acquired over the majority of the North Makeevskoye Licence. Processing of the recently acquired 3D seismic data is currently underway and interpretation expected to be completed in Q3 2012.
The Olgovskoye-14 ("O-14") well was drilled to a TD of 2,800 metres in June and July of 2011 and cased to TD pending further evaluation. Potential hydrocarbon-bearing zones were identified from wireline logging and drilling information. Recent testing of the well indicated low permeability in the reservoir target zones and the well is currently suspended as a potential candidate for fracture stimulation later in 2012. In its initial frac program in the fourth quarter of 2011, KUB-Gas successfully completed the fracture stimulation of two wells, Olgovskoye-6 ("O-6") and Olgovskoye-8 ("O-8"). After being frac'd the O-6 well flowed gas at a rate of 2.3 MMcf/d and the O-8 well flowed gas at a rate of 1.0 MMcf/d, both from previously non-commercial zones.
About CUB Energy Inc.
CUB Energy Inc. is a TSX Venture Exchange company focused on the exploration and development of oil and gas in Ukraine. The Company is headquartered in Houston, Texas with offices in Kyiv, Ukraine. CUB has 110,000 net acres, in nine fields, in the two major producing basins within Ukraine. The Company's strategy is to use western technology and capital, combined with local expertise to create value in its undeveloped land base, building a portfolio of high margin producing oil and gas assets. CUB shares are traded under the stock symbol KUB.
For further information please contact us or visit our website www.cubenergyinc.com.
Except for statements of historical fact, this news release contains certain "forward-looking information" within the meaning of applicable securities law. Forward-looking information is frequently characterized by words such as "plan", "expect", "project", "intend", "believe", "anticipate", "estimate" and other similar words, or statements that certain events or conditions "may" or "will" occur. CUB believes that the expectations reflected in the forward-looking information are reasonable; however there can be no assurance those expectations will prove to be correct. We cannot guarantee future results, performance or achievements. Consequently, there is no representation that the actual results achieved will be the same, in whole or in part, as those set out in the forward-looking information.
Forward-looking information is based on the opinions and estimates of management at the date the statements are made, and are subject to a variety of risks and uncertainties and other factors that could cause actual events or results to differ materially from those anticipated in the forward-looking information. Some of the risks and other factors that could cause the results to differ materially from those expressed in the forward-looking information include, but are not limited to: general economic conditions in the Ukraine and globally; industry conditions, including fluctuations in the prices of natural gas; governmental regulation of the natural gas industry, including environmental regulation; unanticipated operating events or performance which can reduce production or cause production to be shut in or delayed; failure to obtain industry partner and other third party consents and approvals, if and when required; competition for and/or inability to retain drilling rigs and other services; the availability of capital on acceptable terms; the need to obtain required approvals from regulatory authorities; stock market volatility; volatility in market prices for natural gas; liabilities inherent in natural gas operations; competition for, among other things, capital, acquisitions of reserves, undeveloped lands, skilled personnel and supplies; incorrect assessments of the value of acquisitions; geological, technical, drilling, processing and transportation problems; changes in tax laws and incentive programs relating to the natural gas industry; failure to realize the anticipated benefits of acquisitions and dispositions; and the other factors. Readers are cautioned that this list of risk factors should not be construed as exhaustive.
This cautionary statement expressly qualifies the forward-looking information contained in this news release. We undertake no duty to update any of the forward-looking information to conform such information to actual results or to changes in our expectations except as otherwise required by applicable securities legislation. Readers are cautioned not to place undue reliance on forward-looking information.
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