/THIS NEWS RELEASE IS NOT FOR DISSEMINATION IN THE UNITED STATES OR TO
ANY UNITED STATES NEWS SERVICES./
Symbol: BEE: TSX Venture
CALGARY, Aug. 15 /CNW/ - Benchmark Energy Corp. (the "Company" or
"Benchmark") has agreed to acquire interests in the Azar Block in the Putumayo
Basin of Colombia, from Geodinpro Ltda ("Geodinpro"), a local Colombian
Pursuant to the terms of the agreement between Benchmark and Geodinpro
(the "Agreement"), Benchmark has agreed to pay US$2 million in cash plus
US$1 million worth of Benchmark shares, in exchange for a 20% interest in the
portion of the block containing the Palmera and Florida structures, and a 15%
interest in the remainder of the block. This acquisition by Benchmark is
subject to the satisfactory completion of due diligence by Benchmark, and to
the completion of formal documentation.
The operator of the Azar Block is Gran Tierra Energy Inc. ("Gran
Tierra"), which holds a 40% interest after recently agreeing to farm-out a 40%
interest. The Azar Block covers 51,639 acres (209 square kilometers) and is
immediately east of the currently producing Santana and Guayuyaco Blocks, and
is located approximately 20 kilometers east of the recent Juanambu-1 and
Costayaco-1 oil discoveries of Gran Tierra and Solana Resources Limited that
tested flow rates of up to 5,906 barrels of oil per day and 778 barrels of oil
per day respectively.
Work commitments in the Azar Block consist of six consecutive phases. The
first phase requires the acquisition of new seismic data, which is planned to
be completed during the remainder of 2007. The second phase requires a
work-over of an existing exploration well, Palmera-1, which encountered oil
shows during drilling and in which oil pay was interpreted from logs. The well
was never tested as it was not deemed commercial at the time it was drilled in
1996. The third phase requires the drilling of a new exploration well. The
subsequent three phases each contain one exploration well commitment per
phase. The Azar Block is subject to the new and fiscally attractive Agencia
Nacional de Hidrocarburos royalty/tax contract which includes no additional
Under the terms of the Agreement and Joint Operating Agreement between
Geodinpro and Argosy Energy International (a subsidiary of GranTierra)
Benchmark would be carried through the first two exploratory phases (seismic
acquisition and re-entering of the Palmera-1 well). For the third exploratory
phase (drilling of the first exploration well), Benchmark would be required to
pay 10% of the well value to maintain its 15% working interest. For subsequent
phases, Benchmark would be required to pay its 20% or 15% share, depending
upon which portion of the Block is being explored and developed.
In addition to the Agreement, Benchmark has entered into an exclusive
option with Union Temporal Andina until August 31, 2007, on the
Nancy-Maxine-Burdine Block in the Putumayo Basin of Colombian, and is in the
process of completing its due diligence on the Block, and negotiating possible
acquisition or farm-in terms with the current interest holders.
"The acquisition of the Azar Block interests, and the option on the
producing Nancy-Maxine-Burdine Block, both of which are found within the
prolific Putumayo Basin, represent an integral part of Benchmark's strategy to
join projects which either hold near-term production potential, and/or have
the opportunity to grow the current production," commented David Robinson,
Benchmark's President and Chief Executive Officer.
This news release shall not constitute an offer to sell or the
solicitation of any offer to buy the securities in any jurisdiction.
Certain information regarding Benchmark contained herein may constitute
forward-looking statements within the meaning of applicable securities laws.
Forward-looking statements may include estimates, plans, anticipations,
expectations, opinions, forecasts, projections, guidance or other similar
statements that are not statements of fact. Although Benchmark believes that
the expectations reflected in such forward-looking statements are reasonable,
it can give no assurance that such expectations will prove to be correct.
These statements are subject to certain risks and uncertainties and may be
based on assumptions that could cause actual results to differ materially from
those anticipated or implied in the forward-looking statements. Benchmark's
forward-looking statements are expressly qualified in their entirety by this
The TSX Venture Exchange does not accept responsibility for the adequacy
or accuracy of this release.
For further information:
For further information: Benchmark Energy Corp., David R. Robinson,
President, Phone: (403) 802-0770, Fax: (403) 266-5732, E-Mail: