TSX Venture Exchange
Trading Symbol: PCA
CALGARY, Nov. 10, 2011 /CNW/ - PetroSands Resources (Canada) Inc. ("PCA" or the "Company") has commenced its fall drilling program on the previously announced
oil-weighted assets (acquired on February 25, 2011) at Provost,
Alberta. The drilling program includes lower Mannville oil wells (2
verticals & 1 horizontal) (2.9 net), to be drilled prior to December
PCA's first well, "PCA Provost 103/04-29-38-3W4", (100% working
interest) a vertical Cummings development location, was recently
successfully drilled and completed. Swabbing operations have
established excellent inflow and pressure tests have confirmed the
formation has near virgin reservoir pressure. Downhole pumping
equipment was installed in the wellbore and the well was equipped and
tied-in to a nearby Company owned and operated infrastructure (100%).
The well commenced production at a daily rate of 75 barrels of oil per
day with the expectation of leveling off at an IP (initial production
rate) rate of approximately 30 - 50 boe/d (30 day average).
The Company's second Provost well is a vertical exploration well (90%
WI) targeting the Dina formation. The well is scheduled to spud
mid-November. If successful, the resulting new pool discovery will be
delineated with both vertical and horizontal wells in early 2012.
The Company's third Provost well (100% WI) is a horizontal development
well targeting the Rex lithic channel system. This location is expected
to spud towards the end of November, or early December.
Anticipated incremental production is expected by year-end as all three
Provost wells are located in close proximity to existing pipelines and
surface facilities. Emulsion will be processed at the Company's 100%
owned Provost Battery. The Company estimates initial cumulative
production to be approximately 100 - 150 boe/d with resulting reserve
Results of the second and third Provost drill locations will be released
as soon as the information becomes available. All three wells qualify
as Canadian Exploration Expense (CEE) and Canadian Development Expense
(CDE), as defined by Canada Revenue Agency and will fulfill the
Company's remaining 2011 flow-through obligations.
PCA is also progressing with its 3-D seismic program in the Provost
area. Data is expected to be processed in Q4 2011 and the Company is
confident that seismic interpretation could lead to new pools for
exploitation and tied into Company owned infrastructure.
Continued success in developing the Provost property is expected to add
significant value to PCA's current asset base. The Company will
therefore continue to focus on expanding and proving the Provost assets
through the balance of 2011 and into 2012.
PCA has secured a farm-in arrangement with a major company in the
Company's core area of Provost at east-central Alberta that includes 4
sections of land on a significant Mannville horizontal oil drilling
opportunity. The terms of the agreement allows PCA to earn 65 percent
in 2 sections of the prospect by drilling one horizontal test well. The
farm-in also contains a rolling option in favor of the farmee to shoot
a 3D seismic program or drill to earn the balance of the lands under
the subject agreement. Should prospect prove to be successful, PCA
anticipates a development program of 4 additional horizontal oil wells.
The Company plans to drill the wells using monobore drilling technology
that will provide cost-effective savings together with the added
flexibility of selective completion intervals to maximize productivity
and potentially result in additional cost control.
PetroSands Resources (Canada) Inc. is a dynamic, publicly traded junior
oil producer targeting oil-based opportunities in Western Canada. The
Company is focused on strategic oil-based acquisitions within its core
areas, in addition to exploiting and exploring for incremental
production and reserves. The Company currently has approximately 38.2
million common shares outstanding. PetroSands' shares are listed on the
TSX-V under the trading symbol "PCA".
* Boe Presentation: The term BOE may be misleading, particularly if used in isolation. A BOE
(barrel of oil equivalent) conversion of 6 million cubic feet (Mcf): 1
barrel (bbl) is based on an energy equivalency conversion method
primarily applicable at the burner tip and does not represent a value
equivalency at the wellhead.
Forward-Looking Statements: This news release contains certain forward-looking statements, including
but not limited to, management's assessment of future plans and
operations, expected success from drilling operations, expectations
regarding future levels of production, revenues and drilling inventory,
capital expenditures and the timing thereof and expected timing and
results from operations, all of which involve substantial known and
unknown risks, uncertainties and assumptions, certain of which are
beyond the Company's control. Such risks, uncertainties and assumptions
include, without limitation, oil and gas exploration, development,
exploitation, production, marketing, processing and transportation,
loss of markets, volatility of commodity prices, currency fluctuations, imprecision of
reserve estimates, environmental risks, competition from other
producers, inability to retain drilling rigs and other services, delays
resulting from or inability to obtain required regulatory approvals and
ability to access sufficient capital from internal and external
sources, the impact of general economic conditions in Canada, the
United States and overseas, industry conditions, changes in laws and
regulations (including the adoption of new environmental laws and
regulations) and changes in how they are interpreted and enforced,
increased competition, the lack of availability of qualified personnel
or management, fluctuations in foreign exchange or interest rates,
stock market volatility and market valuations of companies with respect
to announced transactions and the final valuations thereof, and
obtaining required approvals of regulatory authorities. The Company's
actual results, performance or achievements could differ materially
from those expressed in, or implied by, these forward-looking
statements and, accordingly, no assurances can be given that any of the
events anticipated by the forward-looking statements will transpire or
occur, or if any of them do so, what benefits that the Company will
derive there from. Readers are cautioned that the foregoing list of
factors is not exhaustive. Additional information on these and other
factors that could affect the Company's operations and financial
results are included in reports, including the Company's annual
information form for the financial year ended December 31, 2009, on
file with Canadian securities regulatory authorities and may be
accessed through the SEDAR website (www.sedar.com). All subsequent forward-looking statements, whether written or oral,
attributable to the Company or persons acting on its behalf are
expressly qualified in their entirety by these cautionary statements.
Furthermore, the forward-looking statements contained in this news
release are made as at the date of this news release and the Company
does not undertake any obligation to update publicly or to revise any
of the included forward-looking statements, whether as a result of new
information, future events or otherwise, except as may be required by
applicable securities laws.
NEITHER THE TSX VENTURE EXCHANGE NOR ITS REGULATION SERVICES PROVIDER
(AS THAT TERM IS DEFINED IN THE POLICIES OF THE TSX VENTURE EXCHANGE)
ACCEPTS RESPONSIBILTY FOR THE ADEQUACY OR ACCURACY OF THIS NEWS
SOURCE PetroSands Resources (Canada) Inc.
For further information:
Greg T. Busby, President & CEO
PETROSANDS RESOURCES (CANADA) INC.
Telephone: (403) 265-2770
Fax: (403) 265-2775
Dwight Fieseler, Chief Financial Officer
PETROSANDS RESOURCES (CANADA) INC.
Tel: (403) 265-2770
Fax: (403) 265-2775
TSX Venture: PCA