CALGARY, ALBERTA--(Marketwired - Jun 18, 2013) - Petrominerales (PMG.TO) (BVC:PMGC) announces an operational update highlighted by our Curito-1 discovery well that tested over 5,900 barrels of oil per day ("bopd").
Curito Discovery, Casanare Este Block, Central Llanos Basin, Colombia (100% WI)
The Curito-1 exploration well was drilled to target depth of 10,390 feet. We cased the well based on our petrophysical interpretation and performed initial tests using a progressive cavity pump ("PCP") in the following four intervals:
- the Ubaque test averaged 69 barrels per day of 14.5 degree API oil at a 86 percent water-cut over a 44 hour period;
- the Gacheta test averaged 93 barrels per day of 14.3 degree API oil at a 52 percent water-cut over a 65 hour period;
- the Mirador test averaged 162 barrels per day of 29.4 degree API oil at a 70 percent water-cut over a 27 hour period; and
- the Carbonera C7 test averaged 593 barrels per day of 34.3 degree API oil at an eight percent water-cut over a 43 hour period.
Following analysis of the test results, we equipped the well with an electric submersible pump ("ESP") and initiated a production test of the C7 formation. The well produced an average of 5,973 bopd at a two percent water-cut over 10 hours. Due to limited fluid storage and facilities on site, the ESP was turned off, and the well has been flowing under natural flow conditions for the last four days at a stabilized rate of over 2,700 bopd at less than one percent water-cut. We plan to evaluate the well over a long-term production test to determine the potential size and additional follow-up locations of this new multi-zone discovery.
March 31, 2013
Our second quarter to-date production averaged 21,105 bopd, representing a four percent decrease over the first quarter primarily due to shut-in production of approximately 700 bopd for well servicing and natural declines that exceeded production additions in the period. The majority of our new production was added late in the quarter in June, and as a result our current production is over 24,000 bopd. The main production additions were:
- Orito-197 that is producing over 1,400 bopd (our working interest);
- Mantis-4 and Mantis-5 that are currently contributing over 1,400 bopd combined; and
- Curito-1 that is producing over 2,700 bopd.
In addition, we are currently evaluating two wells that could add production early in July, Taya-2 and Orito-Norte.
Mantis Oil Field, Casimena Block, Central Llanos Basin, Colombia (100% WI)
We drilled two wells, Mantis-4 and Mantis-5 that were not included in our December 31, 2012 reserve report. Mantis-4 confirmed a southwest extension to the field in both the Upper and Lower Mirador Formations. The well was placed on production and to-date has averaged 355 barrels per day of 13 degree API oil at a 93 percent water-cut. Mantis-5 is an in-fill location that was placed on production in June and to-date has averaged 1,080 barrels per day of 14 degree API oil at a 50 percent water-cut. We are currently drilling Mantis-6, a well intended to test a northern extension of the Mantis field.
Orito, Putumayo Basin, Colombia
We recommenced our Orito development drilling program in December 2012 and have drilled four wells to-date targeting the Villeta Formation. Our most recent well, Orito-197, was brought on production in early June and is producing over 1,400 bopd of 26 degree API oil with less than one percent water-cut. Currently, Orito-Norte is being completed and Orito-151 is drilling.
Canaguaro Acquisition Closed
We are pleased to announce that we have closed our previously announced acquisition of an 87.5 percent interest in the Canaguaro Block, pending final ANH approval.
Petrominerales acquired the Canaguaro Block for a cash consideration of US$15.95 million, plus a commitment to carry our joint venture partner on their first US$5.3 million of costs. The Canaguaro Block has one producing oil field, proven reserves and exploration potential.
As previously disclosed, our acquisition of the Canaguaro Block is strategic for a number of reasons, including accretive transaction metrics of $24.57 per barrel of proved plus probable reserves, the addition of 2.3 million barrels of proved plus probable reserves, over 400 bopd of additional production and providing a contiguous area of underexplored land located adjacent to our Blocks 25 and 31. We believe the Canaguaro Block is on the same fault trend as other oil fields to the south of the block, including the Balay discovery and our Corcel and Guatiquia discoveries.
For the remainder of 2013, we plan to drill up to 18 wells, balanced between development drilling opportunities and high-impact exploration. Our plan includes:
- Continuing development drilling programs at our Orito and Neiva blocks, drilling up to two more wells at Orito and up to six wells at Neiva;
- Drilling up to two wells on our Central Llanos acreage focusing on appraisal and development wells at our Mantis oil field and new discovery at Curito;
- Drilling up to four exploration wells in Llanos Basin of Colombia targeting three new Deep Llanos prospects and one lower risk drilling location on our recently acquired Canaguaro Block;
- Drilling Mochelo Sur horizontal well to validate our heavy oil commercial production plan;
- Drilling our first two wells in Brazil targeting a large, tight oil resource on our newly acquired lands;
- Exposure to the first of two high-impact exploration prospects to be drilled by our joint venture partner in Peru at no cost to Petrominerales as we are carried on the cost of these wells by our joint venture partner; and
- Continue the formal process to pursue opportunities to monetize our pipeline assets.
We look forward to updating our shareholders on our progress throughout 2013.
Petrominerales Ltd. is an international oil and gas company operating in Latin America since 2002. Our high-quality land base and multi-year inventory of exploration and development opportunities in Colombia, Perú and Brazil provide long-term growth potential for years to come.
Forward-Looking Statements and Cautionary Language. Certain information provided in this press release constitutes forward‐looking statements. Specifically, this press release contains forward‐looking statements relating to the Company's future exploration and development activities and the timing for bringing wells on production. The forward‐looking statements are based on certain key expectations and assumptions, including expectations and assumptions concerning the availability of capital, the success of future drilling and development activities, the performance of existing wells, the testing and performance of new wells, prevailing commodity prices and economic conditions, the availability of labour and services, the ability to transport and market our production, timing of completion of infrastructure and transportation projects, weather and access to drilling locations. The reader is cautioned that assumptions used in the preparation of such information, although considered reasonable at the time of preparation, may prove to be incorrect. Actual results achieved during the forecast period will vary from the information provided herein as a result of numerous known and unknown risks and uncertainties and other factors. You can find a discussion of those risks and uncertainties in our Canadian securities filings. Such factors include, but are not limited to: general economic, market and business conditions; fluctuations in oil prices; the test results and performance of exploration and development drilling, recompletions and related activities; timing and rig availability; availability of transportation and offloading capacity, outcome of exploration contract negotiations; fluctuation in foreign currency exchange rates; the uncertainty of reserve estimates; changes in environmental and other regulations; risks associated with oil and gas operations; and other factors, many of which are beyond the control of the Company. There is no representation by Petrominerales that actual results achieved during the forecast period will be the same in whole or in part as those forecast; and there is no representation by Petrominerales that the test results of any new exploration well or development well is necessarily indicative of long-term performance or ultimate recovery. Except as may be required by applicable securities laws, Petrominerales assumes no obligation to publicly update or revise any forward‐looking statements made herein or otherwise, whether as a result of new information, future events or otherwise.
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Corey C. Ruttan
President and Chief Executive Officer
+1.403.705.8850 or +571.629.2701
Chief Operating Officer
+1.403.705.8850 or +571.629.2701
Kelly D. Sledz
Chief Financial Officer
+1.403.705.8850 or +571.629.2701