VANCOUVER, Dec. 12, 2018 /CNW/ - CruzSur Energy Corp. (the "Company") (TSXV: CZR), is pleased to provide an update on the Maria Conchita Block in Colombia which it operates under the 100% owned subsidiary´s Colombian branch MKMS Enerji Sucursal Colombia ("MKMS").
With the drilling of the Istanbul-1 well (the "Well"), the commitments with the National Hydrocarbon Agency of Colombia ("ANH" – Agencia Nacional de Hidrocarburos) for phase 2 of the exploration program of the Maria Conchita Exploration and Production Contract (the "Contract") have been completed.
Based on the results of the Well a technical discovery was registered with the ANH on July 17, 2018, by which the rights to the hydrocarbons are preserved for MKMS for as long as it holds title to the Contract.
On September 3, 2018 MKMS declared an evaluation area under the terms of the Contract, covering an area of 32,518 acres, which includes all of the prospective area of the block, including the Tinka-1, Aruchara-1 and Istanbul-1 wells which all tested gas. In order to retain this area MKMS submitted an evaluation program to be completed within a year and has the option to extend the program for a further year if a one well commitment is made to the ANH.
Currently MKMS is pursing a modification to the existing environmental licence to allow testing of the Aruchara-1 well which will lead to a more complete evaluation of the block when combined with results of Istanbul-1. Simultaneously, MKMS is studying several options to re-enter Istanbul-1 in order to selectively test the zones that appear to be gas bearing but did not have the opportunity to flow in the original test.
Under the terms of the Contract and its addendums, phase 2 of the exploration program terminated on December 10, 2018 and the MKMS formally notified the ANH that it will not continue to Phase 3. As a consequence of this, the Company will not be committed to drill any further wells, although it may do so as a result to the evaluation program, and it will be returning to the ANH the portion of the block not covered by the evaluation area, approximately 46% of the original area.
About the Maria Conchita Block.
The Maria Conchita Block covers an area of approximately 60,076 acres in the Department of La Guajira, Colombia. The E&P Contract for the Maria Conchita Block was signed on January 22, 2009. In January 2017, the MKMS acquired an 80% participating interest and operatorship of the Maria Conchita Block. In February 2018, the MKMS's subsidiary, MKMS was approved as operator of the Maria Conchita Block by the ANH.
There have been two wells drilled by Texaco (Aruchara-1 in 1980 and Aruchara-2 in 1982), and two wells drilled by Ecopetrol (Almirante-1 in 1988 and Tinka-1 in 1988). The Aruchara-1 well tested gas in the Upper and Middle Miocene at a combined rate of 18 million standard cubic feet per day ("mmscfd"). The Tinka-1 well tested in the Upper Miocene at a combined rate of 3 mmscfd. 3-D seismic has been acquired over both discoveries, and the Environmental Impact Assessment permit has been granted. Maria Conchita is close to both of Colombia's gas trunk lines. The Maria Conchita Block neighbors the Chuchupa Block to its north, which is one of Colombia's largest gas fields with an initial 900 MMBoe in place and currently accounts for approximately 40% of Colombia's daily natural gas output. The Chuchupa Block has been on production for over 35 years, and it is currently operated by Chevron in association with Ecopetrol, S.A.
About CruzSur Energy Corp.
CruzSur is investing in proven leadership and technology to develop oil and natural gas fields it has acquired in areas surrounding some of the key energy producing areas in Colombia and Argentina. With decades of proven experience in Latin America and global energy development, CruzSur's leadership is working with local partners and service providers to deliver the energy for Latin America's future.
Except for the statements of historical fact, this news release contains "forward-looking information" within the meaning of the applicable Canadian securities legislation that is based on expectations, estimates and projections as at the date of this news release. The information in this news release about the completion of the operations described herein, and other forward-looking information includes but is not limited to information concerning the intentions, plans and future actions of the parties to the transactions described herein and the terms of such transaction.
Factors that could cause actual results to differ materially from those described in such forward-looking information include, but are not limited to, risks related to the Company's inability to perform the proposed operations.
The forward-looking information in this news release reflects the current expectations, assumptions and/or beliefs of the Company based on information currently available to the Company. In connection with the forward-looking information contained in this news release, the Company has made assumptions about the Company's ability to complete the planned operations and activities. The Company has also assumed that no significant events will occur outside of the Company's normal course of business. Although the Company believes that the assumptions inherent in the forward-looking information are reasonable, forward-looking information is not a guarantee of future performance and accordingly undue reliance should not be put on such information due to the inherent uncertainty therein.
Any forward-looking information speaks only as of the date on which it is made and, except as may be required by applicable securities laws, the Company disclaims any intent or obligation to update any forward-looking information, whether as a result of new information, future events or results or otherwise.
Neither the TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.
SOURCE CruzSur Energy Corp.
For further information: CruzSur Energy Corp., Ralph Gillcrist, CEO & President; Chris Reid, CFO, Tel: +1 (604) 609-6110, E-mail: [email protected]