CALGARY, ALBERTA--(Marketwire - Jan. 7, 2013) -
(NOT FOR DISSEMINATION IN THE UNITED STATES OF AMERICA)
Suroco Energy Inc. (TSX VENTURE:SRN) ("Suroco" or the "Corporation") is pleased to announce that the Cohembi-13 appraisal well has been successfully drilled and placed on production and water injection for improved recovery in the Cohembi oilfield commenced on December 14, 2012. Average monthly production for the Corporation during December 2012 was a record high of 1,271 barrels of oil per day net to the Corporation after royalty.
Mr. Alastair Hill, the Corporation's President and Chief Executive Officer commented, "The commencement of water injection in the Cohembi oilfield is an important milestone for reserve development and increased recovery from this large field. We will continue with appraisal drilling at Cohembi in 2013, with the target of full field development and full pressure maintenance by early 2014. "
The Cohembi-13 well was spudded on November 22, 2012 and drilled directionally to the south from the Cohembi-2 surface pad, approximately 1,000 meters from the nearest bottomhole well location. The well reached a total depth of 9,534 feet (8,649 feet true vertical depth), and encountered 12 feet of high quality net oil pay with no indication of an oil-water contact. Cohembi-13 was subsequently cased and completed, and commenced production into the Cohembi facility via the existing 4-inch flowline and a newly constructed 6-inch group flowline. Production during the first 6 days averaged 573 barrels of oil per day (84 barrels of oil per day net to the Corporation after royalty) with no significant water production. The electric submersible pump is operating at the low end of its producing range, and may be increased further depending on pump and motor performance.
Cohembi Development Update
Water injection for improved recovery within the Cohembi oil field commenced on December 14, 2012 and averaged 2,700 barrels of water injected per day during the remainder of the month. Subsequent to the initiation of water injection at the Cohembi-1 well, the surrounding wells Cohembi-2, Cohembi-5, Cohembi-7, and Cohembi-12 have shown a distinct change in the established bottomhole pressure trends during December that the Corporation interprets as response to water injection. No significant water production has been observed from any of the Cohembi oil wells to date. The initiation of water injection and the subsequent pressure response at producing wells are key elements for recognition of improved recovery potential in the proven reserve category. This information will be submitted to the Corporation's independent reserve evaluator for consideration in the upcoming 2012 year-end reserve evaluation.
The drilling rig will now be moved to the newly constructed Cohembi-6 pad to drill three delineation wells in the southern area of the Cohembi field.
Suroriente Production Update
Total production from the Suroriente field during December 2012 averaged 7,558 barrels of oil per day (1,271 barrels of oil per day net to the Corporation after royalty). This record level of production for the Corporation in the Suroriente field was achieved by the addition of production from the Cohembi-12 and Cohembi-13 wells, along with the early benefit of pressure maintenance by water injection at Cohembi-1. The exit production rate for December was approximately 1,400 barrels of oil per day net to the Corporation after royalty.
Further details explaining the Corporation's activities are contained in a presentation on the Corporation's website at www.suroco.com.
The Corporation is a Calgary-based junior oil and gas company, which explores for, develops, produces and sells crude oil, natural gas liquids and natural gas in Colombia. The Corporation's common shares trade on the TSX Venture Exchange under the symbol SRN.
This press release contains forward-looking statements relating to the operational, exploration and development activities for Suroco, the evaluation of certain prospects in which the Corporation holds an interest, estimated number of drilling locations, expected capital program (including its allocation), production rates, production growth and other statements that are not historical facts. Readers are cautioned not to place undue reliance on forward-looking statements, as there can be no assurance that the plans, intentions or expectations upon which they are based will occur. By their nature, forward-looking statements involve numerous assumptions, known and unknown risks and uncertainties, both general and specific, that contribute to the possibility that the predictions, estimates, forecasts, projections and other forward-looking statements will not occur, which may cause actual performance and results in future periods to differ materially from any estimates or projections of future performance or results expressed or implied by such forward-looking statements. These assumptions, risks and uncertainties include, among other things, the state of the economy in general and capital markets in particular; fluctuations in oil prices; the results of exploration and development drilling, recompletions and related activities; changes in environmental and other regulations; risks associated with oil and gas operations and future exploration activities; the need to obtain required approvals from regulatory authorities; product supply and demand; market competition; political and economic conditions in the country in which the Corporation operates; and other factors, many of which are beyond the control of the Corporation. You can find an additional discussion of those assumptions, risks and uncertainties in Suroco's Canadian securities filings.
Readers should also note that even if the future development program as proposed by Suroco is successful, there are many factors that could result in production levels being less than anticipated or targeted, including without limitation, greater than anticipated declines in existing production due to poor reservoir performance, mechanical failures or inability to access production facilities, among other factors.
The forward-looking statements contained in this press release are made as of the date of this press release. Except as required by law, Suroco disclaims any intention and assumes no obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise. Additionally, Suroco undertakes no obligation to comment on the expectations of, or statements made by, third parties in respect of the matters discussed above.