CALGARY and LONDON, UK, June 13 /CNW/ - Solana Resources Limited (TSX-V:
SOR; AIM: SORL) is pleased to announce that the Costayaco-4 well, a 540 metre
crestal step out to the north of the Costayaco-2 well, has been successfully
drilled, cored, logged and cased as planned. Initial evaluation indicates that
Costayaco-4 has in excess of 200 feet of potential net oil pay, which is over
25% more than any of the previous three wells in the field.
The Costayaco field was discovered in the second quarter of 2007 and is
located in the Chaza block, Putumayo Basin, southern Colombia. The field is
currently producing approximately 7,000 barrels of oil per day ("bopd") gross,
3,730 bopd net of royalty to Solana.
Solana holds a 50% working interest in the Chaza block with Gran Tierra
Energy Inc., the operator, holding the balance. This block is subject to an
Agencia Nacional de Hidrocarburos contract.
Costayaco-4 was drilled directionally from the Costayaco-2 well site and
reached a total measured depth of 8,884 feet, total vertical depth of
7,344 feet, on May 24, 2008. Cores were obtained from the two primary
reservoirs; 48 feet from the Villeta T and 30 feet from the Caballos.
Hydrocarbon shows and lithology similar to Costayaco-1 and Costayaco-2 were
encountered. Solana's initial log interpretations, combined with core samples
and hydrocarbon shows, indicate reservoir quality sandstones with 16 feet of
potential oil pay in the Rumiyaco Kg, 18 feet in the Villeta U, 38 feet in the
Villeta T, and 134 feet in the Caballos.
A testing program to evaluate the hydrocarbon reservoirs encountered
during drilling is currently being designed. Testing operations are expected
to commence in late June and to take approximately one month.
The Pride-17 rig used to drill Costayaco-4 was released on June 7, 2008,
and is currently being moved to the Costayaco-5 location. Costayaco-5, a field
delineation well, is located approximately 1,120 meters west of Costayaco-2
and 1,060 metres north west of Costayaco-1. This well is targeting down dip
portions of the productive reservoirs on the western flank of the field in an
attempt to determine an oil water contact in the Villeta T reservoir, and to
further define the Costayaco field reserves. Drilling is expected to commence
in late June and be completed in late July.
The partners have embarked on a continuous Costayaco drilling program
which will include Costayaco-6 and Costayaco-7 in 2008.
Production from the Costayaco field is currently trucked to the
offloading facilities at Uchupayaco which is connected to existing pipeline
infrastructure. The 10 kilometre, eight inch pipeline from the Costayaco field
to Uchupayaco, which will replace trucking operations, is currently under
construction with a forecasted in service date of early August 2008. Once
connected to existing infrastructure, plans are to ramp up Costayaco
production to approximately 10,000 bopd, gross, overcoming the downstream
Santana to Orito pipeline bottleneck by trucking approximately 3,000 bopd
across this pipeline segment. The opportunity to possibly truck a further
3,000 to 5,000 bopd, gross, north to Neiva is being investigated. Additional
infrastructure expansion to accommodate the anticipated increase in production
from the continuing Costayaco drilling program and to negate the need for
trucking is advancing.
Mr. Glenn Van Doorne, Chief Operating Officer of Solana, a Petroleum
Geologist, is the qualified person who has reviewed the technical information
contained in this news release.
Forward Looking Statements
Certain information regarding the Company, including management's
assessment of future plans and operations, may constitute forward-looking
statements under applicable securities law and necessarily involve risks
associated with oil and gas exploration, production, marketing and
transportation such as loss of market, volatility of prices, currency
fluctuations, imprecision of reserve estimates, mechanical problems, equipment
limitations, environmental risks, competition from other producers and ability
to access sufficient capital from internal and external sources; as a
consequence, actual results may differ materially from those anticipated.
Solana Resources Limited
Solana (www.solanaresources.com) is an international resource company
engaged in the acquisition, exploration, development and production of oil and
natural gas. The Company's properties are located in Colombia, South America
and are held through its wholly owned subsidiary, Solana Petroleum Exploration
(Colombia) Limited. The Company is headquartered in Calgary, Alberta, Canada.
NO REGULATORY AUTHORITY HAS APPROVED OR DISAPPROVED THE CONTENT OF THIS
RELEASE. THE TSX VENTURE EXCHANGE DOES NOT ACCEPT RESPONSIBILITY FOR THE
ADEQUACY OR ACCURACY OF THIS RELEASE
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