CALGARY, July 27, 2012 /CNW/ - Shona Energy Company, Inc. (TSXV: SHO)
(OTCQX: SHOAF) ("Shona" or the "Company"), today announced that the Operator of Block 102, Pluspetrol E&P S.A.
("Pluspetrol"), has advised that Shona's planned production test of the
Boa Oeste 1X well, which was disclosed in the Company's press release
dated April 3, 2012, has been delayed. As a result of the delay, and
upon further evaluation of the benefits of the production test, the
Company has determined that further expenditures on the Boa Oeste 1X
well, including the cost of the proposed testing, is not economically
warranted. Accordingly, Shona has elected to be a Non-Consenting Party
under the terms of its Joint Operating Agreement and relinquish its
rights to the Boa Oeste 1X well, as well as any future Development Area
for the well. Shona will retain its 36.5 per cent working interest in
the rest of Block 102.
"Shona has determined that the proposed three month test on the Boa
Oeste 1X well would not be sufficient to confirm commerciality," said
James L. Payne, CEO of Shona. "Based upon further analysis of the Boa
area, the Consortium has made a strategic decision to turn our focus to
the Macusari and Capahuari trends, which have higher reserve
The Consortium has elected to proceed to the Fourth Exploration Period
of the License Contract for the Block 102. The other Parties in the
well, including the Operator, Pluspetrol, and Andean Oil and Gas
S.A.C., have indicated they will participate in the testing of Boa
Oeste 1X well.
Esperanza Block - Completion of Seismic Program
Shona's wholly owned subsidiary, Geoproduction Oil and Gas Company LLC
("Geoproduction"), has completed the acquisition and processing of 103
square kilometers of 3-D seismic and 14 kilometers of 2-D seismic on
the Esperanza Block, located in Colombia's Lower Magdalena Basin.
Interpretation of the data is in its final phases.
"We are very encouraged by the seismic data, which indicate a number of
prospects that have the same seismic attributes as those observed in
the Nelson Field discovery," said Mr. Payne. "We have initiated an
aggressive marketing program to monetize our existing gas reserves and
numerous low-risk prospects on the Block."
Shona controls 100% working interest in the Esperanza Block through its
ownership of Geoproduction.
Shona is an international oil and natural gas exploration, development
and production company focusing on South America, specifically Colombia
and Peru. The Company's assets currently include interests in the
Company-operated Esperanza block located in Colombia's Lower Magdalena
Basin, the non-operated Serrania, Los Picachos and Macaya Blocks in
Colombia's Caguan Basin, and the non-operated Block 102 in Peru's
Maranon Basin. The common shares of the Company trade on the TSX
Venture Exchange under the stock symbol "SHO" and the OTCQX
International under the stock symbol "SHOAF". More information on the
Company is available at www.shonaenergy.com.
Certain information included in this press release constitutes
forward-looking information under applicable securities legislation.
Such forward-looking information is provided for the purpose of
providing information about management's current expectations and plans
relating to the future. Readers are cautioned that reliance on such
information may not be appropriate for other purposes, such as making
investment decisions. Forward-looking information typically contains
statements with words such as "anticipate", "believe", "expect",
"plan", "intend", "estimate", "propose", "project" or similar words
suggesting future outcomes or statements regarding an outlook.
Forward-looking information in this press release may include, but is
not limited to, expectations regarding future oil and gas production
from the Company's properties, the production capacity of the Company's
properties, the anticipated use of seismic data and exploration and
development plans on properties in which the Company holds an
interest. Forward-looking information is based on a number of factors
and assumptions which have been used to develop such information but
which may prove to be incorrect. Although Shona believes that the
expectations reflected in such forward-looking information is
reasonable, undue reliance should not be placed on forward-looking
information because Shona can give no assurance that such expectations
will prove to be correct. In addition to other factors and assumptions
which may be identified in this press release, assumptions have been
made regarding and are implicit in, among other things: the ability of
Shona to complete transactions described in this press release, the
timely receipt of any required regulatory approvals, the performance of
existing wells and success obtained in drilling new wells, anticipated
expenses, cash flow and capital expenditures, the application of
regulatory and royalty regimes and prevailing commodity prices and
economic conditions. Readers are cautioned that the foregoing list is
not exhaustive of all factors and assumptions which have been used.
Shona undertakes no obligation to update forward-looking statements if
circumstances or management's estimates or opinions should change,
unless required by law. Actual results could differ materially from
those currently anticipated due to a number of factors and risks. These
include, but are not limited to, risks associated with the oil and gas
industry in general (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 relating to production, costs and expenses, and health,
safety and environmental risks), commodity price and exchange rate
fluctuations and uncertainties resulting from potential delays or
changes in plans with respect to exploration or development projects or
Neither the TSX Venture Exchange nor its Regulation Services Provider
(as that term is defined in the policies of the TSX Venture Exchange)
accepts responsibility for the adequacy or accuracy of this press
SOURCE: Shona Energy Company, Inc.
For further information:
For further information please contact either of the following individuals:
David Gian, Treasurer & Investor Relations
Shona Energy Company, Inc.
Shetal Mentlewski, VP Admin & Legal
Shona Energy Company, Inc.