CALGARY, Aug. 14 /CNW/ - Petrolifera Petroleum Limited announced today that following the perforation of the upper portion of the Sierras Blancas Formation in the RN. PM. a-1061 well, situated on the western perimeter of the central pool of the Puesto Morales Block in the Neuquen Basin onshore Argentina, light gravity crude oil flowed on test at a calculated rate of 2,000 bbl/d though an 18 millimeter choke. It will be recalled that, on an earlier test, the well had flowed at a rate of 1,490 bbl/d through the same-sized choke, from perforations in the lower portion of the oil-bearing Sierras Blancas Formation, which was calculated to be 17 meters thick, based on log analysis. Yesterday, August 13, 2007, the well flowed and produced through the same-sized 18 millimeter choke at a rate of 1,324 bbl/d, with no water. Petrolifera's total production for the day exceeded 8,200 boe/d.
Currently, the 1033 and 1042 wells on the Puesto Morales Block have been drilled and logged and await testing. Both wells are indicated multi-zone hydrocarbon discoveries based on drilling and log analysis and are situated on the northern lobe east and northeast of the prolific 1027 well, which tested approximately 2,400 bbl/d from the Sierras Blancas Formation and is now onstream producing at approximately 1,000 bbl/d. Also, as previously announced testing of the uphole Centenario Formation in the 1027 well was deferred, due to the high productivity of the Sierras Blancas Formation in the well, although the well yielded oil from that zone to the mud pits while drilling; this zone will be evaluated later this year through the drilling of a shallow twin well or wells.
The company's service rig has now been moved and is currently on location testing various zones in the Centenario Formation in the 1018 well. This completion rig will return to test both 1033 and 1042 wells, once the testing program at 1018 is completed. Drilling is also underway at the 1044 well on the northern lobe at Puesto Morales. Petrolifera anticipates having three rigs available for drilling on the Puesto Morales Block until year-end 2007, with two completion rigs available on the Block from mid-October onwards. It is anticipated the Quintana Rig No. 13 will be available by late September 2006 for directional drilling at Puesto Morales and will replace the Nabors No. 832 rig, which has been on loan from another company active in the region and is due to be returned once the Q13 rig is on location.
At Rinconada, the 1006 well, which is an approximate two kilometer stepout to the 1001 discovery well, which on test flowed light oil to the surface at rates of approximately 700 bbl/d, has been cased as an indicated Sierras Blancas oil well. This is the third consecutive indicated success in the Rinconada program, which anticipates up to 19 wells to be drilled prior to year end. The 1006 well will be tested later upon the early September arrival of a second service or completion rig, which will assist Petrolifera in meeting its objectives of drilling, testing and completing approximately 55 wells in Argentina by year end. A second drilling rig (Pride) is anticipated to arrive at Rinconada by mid-September 2007.
The company is also evaluating contracting a sixth rig to concentrate on exploratory drilling in the region.
Elsewhere, in Peru the company has just received its Environmental Impact Assessment ("EIA") certificate for Ucayali Block 107. As a result, the company is now in a position to commence its planned 800 kilometer seismic program. Seismic crews are at the staging area and will commence the program over this prospective Block as soon as it is practical. This is a large program on this jungle block and results will assist in determining drillable locations for 2008. The Ucayali Block is on trend with the giant Camisea natural gas and natural gas liquids field and exhibits the potential for both crude oil and natural gas prospects to be developed for further evaluation next year.
Petrolifera Petroleum Limited is a Calgary-based crude oil and natural gas exploration, development and production company. It is active in the Neuquen Basin, Argentina; in the Maranon and Ucayali Basins onshore Peru; and holds concessions onshore Colombia. The company's shares are listed for trading on the Toronto Stock Exchange under the symbol PDP.
FORWARD LOOKING STATEMENTS
This press release contains forward-looking statements, including but not limited to future drilling plans, anticipated capital expenditures, forecast production, anticipated reserve additions and estimated flow rates and levels of water incursions. These statements are based on current expectations that involve a number of risks and uncertainties, which could cause actual results to differ materially from those anticipated. These risks include, but are not limited to risks associated with the oil and gas industry (e.g. operational risks in development, exploration and production, delays or changes in plans with respect to exploration or development projects or capital expenditures; the uncertainty of reserve estimates; the uncertainty of estimates and projections in relation to production, costs and expenses and health, safety and environmental risks), the risk of commodity price and foreign exchange rate fluctuations, the uncertainty associated with negotiating with foreign governments and risk associated with international activity. Additional risks and uncertainties are described in the company's Annual Information Form which is filed on SEDAR at www.sedar.com.
The company's ability to complete its capital program and potentially increase production volumes and reserves is dependent on access to services, drilling rigs and equipment. Similarly, the company's ability to increase sales of oil and natural gas is dependent on sustained productivity of new and existing wells, maintenance (or reduction) of water cuts and completion of certain infrastructure and transportation systems that are currently under construction. There can be no assurance that the flow rates of newly drilled wells will result in stabilized production at these levels or that the company's new or existing high productivity wells will not incur higher water cuts than that reported herein or reductions in reservoir pressures, resulting in a decision to further curtail production pending implementation of the proposed pressure maintenance program or other remedial measures. Due to the risks, uncertainties and assumptions inherent in forward-looking statements, prospective investors in the company's securities should not place undue reliance on these forward-looking statements. Forward looking statements contained in this press release are made as of the date hereof and are subject to change. The company assumes no obligation to revise or update forward looking statements to reflect new circumstances, except as required by law.
A barrel of oil equivalent (boe), derived by converting gas to oil in the ratio of six thousand cubic feet of gas to one barrel of oil, may be misleading, particularly if used in isolation. A boe conversion is based on an energy equivalency conversion method primarily applicable at the burner tip and does not represent a value equivalency at the wellhead.