HOUSTON, TEXAS--(Marketwire - June 27, 2012) - CUB Energy Inc. ("CUB", or the "Company") (TSX VENTURE:KUB), announces KUB-Gas LLC ("KUB-Gas"), a subsidiary in which CUB has a 30% ownership interest, has entered into a contract with Burova Kompaniya Ukrburservice LLC ("Ukrburservice") under which Ukrburservice will provide their Rig #1 to drill the Makeevskoye-16 ("M-16") well.
The Ukrburservice Rig#1 is a 2,000 horsepower National Oilwell Varco ("NOV") drilling rig manufactured in Canada in 2010. It has a lifting capacity of 450 metric tonnes and a depth rating of 7,000 metres. The projected total depth ("TD") of the M-16 well is 3,850 metres and will be the deepest well drilled KUB-Gas to date. This deep test well will evaluate stacked potential reservoir targets in Moscovian, Bashkirian and Serpukhovian aged rocks. Rig moving operations will commence immediately. The M-16 well is expected to spud in mid-August 2012 and take 60 days to reach planned TD.
The contracting of the Ukrburservice Rig#1 will allow for an acceleration of the 2012 drilling program. The KUB-Gas owned NOV rig, which was manufactured in Canada in 2007 with a lifting capacity of 200 metric tonnes and a depth rating of 3,050 metres, is currently being moved from the North Makeevskoye-1 ("NM-1") location to the Makeevskoye-20 ("M-20") location. NM-1 reached a TD of 2,500 metres in mid-June and was cased to TD after log and drilling information indicated 4 potential hydrocarbon-bearing zones. Drilling of the M-20 well is expected to commence mid-July with a projected TD of 2,000 metres. The well will target an amplitude anomaly defined by seismic and is a follow-up delineation well to the successful M-19 and M-21 wells.
"With the success the Company has had on the M field, we are excited about the potential of the M-16 and M-20 wells. The M-20 development well, located approximately 900 metres southeast of the currently producing M-19 well and within the same seismic anomaly, is indicative of the Company's strategy of accelerating the drilling of low risk development wells. At the same time, the Company maintains its commitment to growth by allocating a portion of its capital to moderate risk exploratory wells that can add significant value and provide multiple offset drilling locations for the future. With a target depth of 3850 metres, M-16 will not only target formations that currently produce within the M field, but will also target deeper formations that have only been sparsely tested within M license." Said Mr Cliff M. West, Executive Vice President and COO.
The Company also reports completion of the previously announced workover of the Rusko-Komarovske-6 ("RK-6") well. The latest reported production (June 24, 2012) was 211Mcf/d from the Miocene Lukivska Formation through a 7mm choke, with Flowing Wellhead Pressure of 15.5 atm and Casing Pressure of 26.2 atm. This compares to production of 150Mcf/d through Open Flow, with a Wellhead Pressure of 14.6 atm and Casing pressure of 22.3 atm prior to the workover. Additionally, the Company is considering upgrading the RK field gas plant to accommodate the increase of production anticipated from the multi-well development program planned to commence in the 4th Quarter 2012.
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 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.
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