CALGARY, ALBERTA--(Marketwire - Sept. 12, 2012) - Petrominerales Ltd. ("Petrominerales" or the "Company") (TSX:PMG)(BVC:PMGC) provides an operational update highlighted by our Mambo-1 oil discovery on our Corcel Block.
Deep Llanos Basin (Corcel, Guatiquia and South Block 31), Colombia
We drilled our Mambo-1 exploration well to a total measured depth of 11,875 feet on August 23rd. Well logs indicate 13 feet of potential net oil pay in the Lower Sand 1 formation. We cased the well and production tested the Lower Sand Formation with an electric submersible pump ("ESP"). The well produced an average of 1,890 barrels of 23 degree API oil over a 59 hour test period averaging a 36 percent water cut, with an ESP setting of 40 hertz and a 54/64 inch choke setting. After six days, the fluid levels in the well have stabilized and the well is currently producing 839 barrels of oil per day ("bopd") at a 73 percent water cut.
Our Guarana-1 prospect was drilled to a total measured depth of 13,902 feet on August 2nd. Well logs indicate 48 feet of potential net oil pay in the Lower Sand 1 and Guadalupe formations. We tested two intervals: the first interval was in the Lower Sand 1 Formation and we tested water; the second interval was in the Guadalupe formation, where we tested trace amounts of heavy, 11 degree API oil with a coiled tubing unit and nitrogen lift.
Following Guarana-1, we began drilling operations on our next prospect, Maya-1, on September 4th. This prospect is a play concept similar to our recently drilled Macapay well that has produced over 600,000 barrels of oil.
Foothills Blocks (Blocks 25, 31, 59 and 15), Deep Llanos Basin, Colombia
We completed testing the upper intervals of our Bromelia-1 well. As previously reported on August 2nd, the first zone tested an interval in the Barco formation and although the formation demonstrated positive reservoir characteristics with good productivity, the test recovered water. After we recovered the testing string to surface, we found that the downhole packer and test string were coated in heavy oil. Our initial interpretation is that the residual heavy oil encountered would not be economic to produce. Following the Barco test, we tested two intervals in the Mirador Formation and one interval in the Carbonera Formation, although each test only recovered water, we are encouraged by the reservoir deliverability found at these depths on the Block.
We plan to conduct a long-term production test of the high-pressure, high-temperature gas bearing zone and expect to have test results in the fourth quarter.
Central Llanos Basin (Casimena, Castor, Casanare Este, Mapache Blocks), Colombia
We have selected an initial two locations for horizontal development wells on our Yenac field. We expect to commence drilling operations in October and have production additions before year-end. We have also identified two additional horizontal development locations that we plan to drill in the first quarter of 2013. This horizontal development drilling program is targeting the Lower Mirador formation that has been encountered in all of our Yenac and Mantis vertical wells; however, we have only placed Yenac-3 on production in that formation. Yenac-3 has produced over 250,000 barrels of 14 degree API oil since it was placed on production in March 2011.
Llanos Basin Heavy Oil Blocks (Rio Ariari, Chiguiro Oeste, Chiguiro Este), Colombia
We moved the drilling rig to the eastern portion of the Rio Ariari Block and began drilling the first of four stratigraphic wells exploring new play concepts and prospective fairways east of our 3D seismic coverage and of all wells we have drilled to-date. The first well, Mielero-1, was spud on September 3rd, and we expect to have core results in September. In addition, we have initiated a 227 kilometre 2D seismic program on the eastern portion of the Block. Once completed, we plan to drill an additional four stratigraphic wells in this region.
Block 126, Peru
We commenced drilling our Sheshea-1X prospect on July 19th and reached a total measured depth of 8,925 feet on September 9th. Well logs indicate 24 feet of potential net oil pay in the Copacabana and Agua Caliente formations. We currently plan to test up to three reservoir intervals and have results by the end of October. The Sheshea-1X prospect is located approximately 50 kilometres south of our first exploration well, La Colpa 2X, and is a separate prospect and play-type.
Production averaged 25,235 bopd during August, before the addition of our Mambo-1 discovery. August production was eight percent, or 2,218 bopd, lower than the July average primarily due to: our Candelilla-1 well being offline for nine days accounting for 350 bopd of the decrease; our Yenac and Mantis oil fields being shut-in for nine days as a result of community blockades causing a 965 bopd decrease; and natural declines. In addition, we have approximately 750 bopd of production temporarily offline on the Orito Block due to certain wells awaiting workovers, and approximately 460 bopd of production shut-in on the northern part of our Mapache Block due to community disruptions.
Our immediate focus is on executing our high-impact exploration drilling programs in Colombia and Peru. We are acquiring over 1,000 square kilometres of new 3D seismic, 664 square kilometres of which has been acquired and is currently being interpreted. We expect these 3D seismic acquisitions to add significantly to our prospect inventory and to provide new drilling opportunities for our 2013 program. With test results on Sheshea-1X expected by the end of October, the re-activation of our heavy oil program, three more exploration wells to be drilled in the Corcel area and the initiation of our horizontal development drilling program on our Casimena Block in the Central Llanos, we are looking forward to updating our shareholders on our progress throughout the remainder of 2012.
Petrominerales Ltd. is an international oil and gas company operating in Latin America since 2002. Today, Petrominerales is one of the most active exploration companies and one of the largest oil producers in Colombia. Our high quality land base and multi-year inventory of exploration opportunities provides 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.