CALGARY, ALBERTA--(Marketwire - Nov. 22, 2010) - Quetzal Energy Ltd. (TSX VENTURE:QEI) ("Quetzal" or the "Company") is pleased to announce an oil discovery in the Lower Mirador Formation at the well Canaguay - 1 on the Canaguaro Block in Colombia.
Canaguay - 1 is the first well to be drilled on our Canaguaro exploration drilling program. The well began drilling on June 3, 2010, and finished drilling at a final total depth ("TD") of 15,850 feet on August 4, 2010.
Quetzal began completion and testing operations on September 9, 2010. To date the Une / Lower Sandstone, Gacheta, Barco and Lower Mirador intervals have been perforated and tested. The Upper Mirador which has the majority of the indicated oil pay on well logs has not been perforated or tested as at this time but perforating and testing of the Upper Mirador is expected to be completed in the next several weeks.
Canaguay-1: Cased hole Drill Stem Test Summary
DST #1, Une/Lower Sandstone, perforated 15,484 – 15,469 ft, 15 ft: Gas was observed at surface at a rate that was too small to measure and the pressure data indicated relatively poor permeability. 50 barrels of 37 degree API oil was recovered during the reverse circulation after the test.
DST #2, Une/Gacheta, perforated 15,359 – 15,353 ft, 6 ft: Pressure data indicated poor permeability in the interval. A small sample of 27.4 degree API oil was recovered during the reverse circulation of the after the test. Hydrocarbon volumes were too small to measure.
DST #3, Gacheta, perforated 15,248 – 15,231 ft, 17 ft: Pressure data indicated very poor permeability in the interval. No hydrocarbons were recovered during the test.
DST #4, Barco, perforated 14,736 – 14,724 ft, 12 ft: Pressure data and production volumes indicate fair zonal permeability however no hydrocarbons were produced from this interval.
DST #5, Lower Mirador, perforated 14,297 – 14,292 ft, 5 ft: Coiled tubing was run to 6,000 ft and 500 standard cubic feet per minute of Nitrogen was pumped to remove the fluid cushion, and achieve a drawdown of approximately 17%. Fluid production rates averaged 2,225 bbls/day of 20.7 degree API oil with a trace of water during the test.
DST #6, Upper Mirador, perforation interval to be determined based on further study of Lower Mirador results: Open hole well logs indicate that this reservoir is the most prospective in the well, but this must be confirmed by completion and testing over the next several weeks.
Quetzal has a 25% working interest in the Canaguaro Block and is acting as the operator.
This news release contains forward-looking information and forward-looking statements within the meaning of applicable securities laws (together, "forward-looking information"). The use of any of the words "expect", "anticipate", "continue", "estimate", "believe", "plans", "intends", "confident", "may", "objective", "ongoing", "will", "should", "project", "should" and similar expressions are intended to identify forward-looking information. In particular, but without limiting the foregoing, this news release contains forward-looking information concerning the use of proceeds of the recently completed offering of units of the Corporation.
The forward-looking information is based on certain key expectations and assumptions made by Quetzal, including expectations and assumptions concerning the operational results in Colombia and Guatemala. Although Quetzal believes that the expectations and assumptions on which the forward-looking information are based are reasonable, undue reliance should not be placed on the forward-looking information because Quetzal can give no assurance that they will prove to be correct.
Since forward-looking information addresses future events and conditions, by its very nature it involves inherent risks and uncertainties. Actual results could differ materially from those currently anticipated due to a number of factors and risks. These include, but are not limited to, the inherent risks involved in the exploration and development of oil and gas properties, the uncertainties involved in interpreting drilling results and other geological data, uncertainties relating to fluctuating oil and gas prices, the possibility of cost overruns or unanticipated costs and expenses and other factors including unforeseen delays. Anticipated exploration and development plans relating to Quetzal's properties are subject to change.
The foregoing list of assumptions, risks and uncertainties is not exhaustive. The forward-looking information contained in this press release is made as of the date hereof and Quetzal undertakes no obligation to update publicly or revise any forward-looking statements or information, whether as a result of new information, future events or otherwise, unless so required by applicable securities laws.
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