Austral Pacific Energy - Operations Update

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[{"type":"text","content":"\n\n\n\nWELLINGTON, New Zealand, June 11 /CNW/ -- Austral Pacific Energy Ltd.\n(TSX-V: APX; NZSX: APX; Amex: AEN)\n\n\nPreparations are now complete and the A6 well is scheduled to start\ndrilling in the next 24 hours. The well will drill through a secondary\nreservoir and into the primary target over the next 14 days. The well is being\ndrilled from a surface location adjacent to the Cheal production facility and\nwill be directionally drilled to reach the reservoir some 1000 meters to the\nwest and to a depth of 1750 meters.\n\n\nIf the well is successful, it is modeled to add 320,000bbls of\nrecoverable oil and 250 - 350 barrels of oil per day (bopd) to the field's\ncurrent production rate in the order of 500bopd. At today's oil price\n(~$US130/bbl), and production rate, the field generates a revenue stream of\nover US$1.95m/ month. Success in this first of two wells could increase\nproduction to approximately 800bopd and the field revenue stream to $US3.1m/\nmonth. Austral Pacific holds a 69.5% working interest in the field.\n\n\nThe A7 well is scheduled to follow the drilling and completion of the A6\nwell.\n\n\nAustral Pacific has been actively pursuing its strategy to focus on its\ncore assets of Cheal, Kahili and Cardiff; increase production and reduce costs\nthrough a series of steps that have been announced individually over the past\nmonth.\n\n\nCommenting on recent activity in the company, Austral CEO Mr Thom Jewell\nsaid, "We have successfully completed the monetization of our assets in Papua\nNew Guinea; we have reduced the primary company debt from $US18.5m at year end\nto $US9m allowing the company to take on additional debt to benefit from the\nfull upside of high oil prices. The impact of closing out the hedge is an\nincrease in Austral's revenue from Cheal from $US 0.68m/month to $US\n1.4m/month and an increase in the margin per barrel from approximately $US40\nto $US105.\n\n\nMr Jewell further commented that, "in a success case, the A6 well and A7\nwells will increase production and further increase the per barrel margin by\nmaking more efficient use of the new production facilities."\n\n\nCommenting on other announcements, Mr Jewell said he was disappointed in\nthe apparent reaction by a few of the company's shareholders to its decision\nto reduce the number of exchanges from three to two with...

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