CALGARY, Feb. 16, 2015 /CNW/ - PetroNova Inc. ("PetroNova" or the "Company") (TSX-V: PNA), a company engaged in the exploration and development of oil and natural gas resources in Colombia, today provided an operational update for its CPO-13 and Tinigua Blocks, in which PetroNova has a 20% and 40% working interest ("WI"), respectively.
"The CPO-13 Block has become the launching pad for reserve growth for the Corporation and hence the base for expanding our production capacity. The Pendare discovery is emerging as an attractive producer even under relatively harsh economic scenarios. Although we do not yet have conclusive flow tests, preliminary results from the Tillava wells suggest that a similar trapping mechanism of the contiguous fields are present in our block," said Antonio Vincentelli, PetroNova's President and CEO.
In the CPO-13 Block, during phase 2 of the exploration period the Company drilled five wells of an ongoing eight well drilling campaign; the remaining 3 wells have been postponed pending oil market conditions. The results of drilling are presented below:
Step-out drilling of the Pendare Discovery:
Three step-out wells were drilled to establish the Pendare accumulation extension towards the south, southwest and the northeast of the block.
- The Pendare-4 well was spud on November 15, 2014 and drilled to 3,348 feet. The mud and electric logs indicated high water saturation in the targeted Basal Carbonera Sands. The well was temporarily plugged allowing its eventual conversion into a water disposal well to be used if necessary.
- The Pendare-6 well was spud on December 1, 2014 and directionally drilled to 3,642 feet total depth ("TD"). The electrical logs indicate approximately 68 feet of net oil pay in two main sand sections: 25 feet corresponding to the targeted top of the Basal Carbonera Sands (the producing sand in the Pendare-1 and 2 wells) and 43 feet to a new sand not seen in the previous Pendare wells. Production casing was run at 3,637 feet and cemented, the lower interval was tested through perforations yielding 14.3° API oil, but sanded up soon after the test was initiated. A window was milled from 3,508 to 3,550 feet; under-reamed, gravel packed and retested using a jet pump. Stabilized flow was measured at 1,100 barrels of fluid per day ("BFPD") with 54% basic sediment and water. A total of 405 barrels of oil was produced during 40 hours of the jet pump tests. The well was equipped with an electric submersible pump ("ESP") and the drilling rig was moved to the Pendare 3H well. The Company plans to conduct an extended test after Agencia Nacional de Hidrocarburos ("ANH") approval is obtained.
- Pendare-3H, a horizontal well, was spud on January 2, 2015 to optimize the production flow rates of the Pendare discovery. The well was drilled from the Pendare-2 well pad to 4,061 feet to the top of the Basal Carbonera Sands where intermediate casing was set. A horizontal leg was drilled to 5,454 feet measured depth ("MD"), cased with a slotted liner and tested using a jet pump. The test established a stabilized flow rate of about 446 barrels of oil per day ("bopd") of 14.2° API oil (89 bopd net to the Company before royalty) with a 62.7 % watercut. The watercut steadily decreased for the duration of the test from approximately 90% at the beginning of the test to 62.7% at the time the well was shut-in. A total of 417 barrels of oil was produced during 46 hours of the jet pump tests. The well has been equipped with an ESP and based on the estimated productivity index is expected to produce at rates in excess of those attained during the short hydraulic pump test.
Exploratory activity to corroborate the extension of the Trapping Mechanism:
Two exploratory wells were drilled to verify the extension of the trapping mechanism present in the contiguous field, both of which found the Carbonera Basal Sand (the producing sand in the adjoining field) to be oil-bearing:
- The Tillavá Este-1 well was spud on November 30, 2014 and drilled to 2,966 feet TD. The electrical logs, confirmed by side wall cores, indicated approximately 23 feet of net oil pay over a gross interval of approximately 49 feet in the Carbonera Basal Sands, however large washouts were detected at the pay area. Casing was run at 2,960 feet and cemented. A deeper sand from 2,839 to 2,845 feet, which had no oil indication from the side wall cores but exhibited some resistivity on logs, was perforated and tested water. The main oil-bearing sand was perforated and oil was recovered but sanded up soon after the test was initiated. A 41 foot window was milled, under-reamed, gravel-packed and tested with a jet pump recovering mostly water with 1 to 2% of heavy crude, typical of the wells in adjoining block. The rig was moved to the Tillavá Sur-1 location, rig-less logs were run in order to try to determine the origin of the water intrusion and are being interpreted at this time, nevertheless the logging tools were impregnated with crude oil.
- The Tillavá Sur -1 well was spud on January 7, 2015 and drilled to 2,903 feet. Good quality oil-bearing Carbonera Basal Sand was found between 2,671 and 2,683 feet. Casing was cemented and the well was tested with a jet pump through a seven foot milled and gravel packed window. The test yielded an unexpectedly low flow rate with only approximately 4% crude and the jet pump was found to be jam-packed with viscous heavy crude. Several alternatives are being considered to test the well again upon release of the drilling rig.
Other Activities on Block CPO-13:
The Pendare-1 well has been converted to a water injector as part of the environmental license commitments and the production installation upgrading program to handle the flow of the wells in extended testing.
The ANH has formally approved the farm-out of 50% of the Tinigua Exploration and Production Contract to Metapetroleum (a subsidiary of Pacific Rubiales Energy; refer to PetroNova´s press release dated February 28, 2014). The Company plans to initiate drilling in second half of 2015 once military support is obtained and socialization process completed.
2015 PRODUCTION UPDATE
PetroNova's working interest production (before royalties) for the third quarter of 2014 averaged 290 barrels of oil per day. Upon extended testing of Pendare-6 and Pendare-3H, production is expected to increase significantly.
The Company, through its subsidiaries, is engaged in the exploration for, and the acquisition and development of, oil and natural gas resources in South America, specifically in Colombia. The Company's assets currently include the Company's interests in the PUT-2 and Tinigua Blocks located in the Caguan-Putumayo Basin in Colombia, both of which are operated by the Company, and the non-operated Llanos Blocks located in the Llanos Basin in Colombia. The common shares of the Company trade on the TSX Venture Exchange under the stock symbol "PNA".
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 release.
Caution Regarding Forward-Looking Statements and Information:
Certain statements and information contained in this press release constitute forward-looking statements and information (collectively "forward-looking statements") within the meaning of applicable securities laws. These statements relate to future events or the Company's future performance. All statements other than statements of historical fact are forward-looking statements. The use of any of the words "anticipate", "intend", "plan", "continue", "estimate", "budget", "targeting", "project", "expect", "may", "will", "might", "should", "could", "believe", "predict" and "potential" and similar expressions are intended to identify forward-looking statements. Such statements represent the Company's internal projections, estimates, expectations, beliefs, plans, objectives, assumptions, intentions or statements about future events or performance. These statements involve known and unknown risks, uncertainties and other factors that may cause actual results or events to differ materially from those anticipated in such forward-looking statements. Management believes the expectations reflected in these forward-looking statements are reasonable but no assurance can be given that these expectations will prove to be correct and such forward-looking statements included in this press release should not be unduly relied upon.
In particular, this press release contains forward-looking statements pertaining to the Company's future exploration and development activities and the timing thereof, including extended testing of discoveries on the CPO-13 Block; expected production rates of certain wells, the drilling campaign on the Tinigua Block; expected 2015 production volumes and/or rates; the military support required to drill a first exploratory well on the Tinigua Block; and the exploration, appraisal and development operations expected for the first six months of 2015. With respect to forward-looking statements contained in this press release, assumptions have been made regarding, among other things: general economic, market and business conditions in Colombia and globally; future crude oil and natural gas prices; the continued availability of capital, undeveloped lands and skilled personnel; the ability to obtain equipment in a timely manner to carry out exploration and development activities; the regulatory framework governing royalties, taxes and environmental matters in Colombia and any other jurisdictions in which the Company may conduct its business in the future; the ability of the Company to obtain the necessary approvals, permits and licences to conduct its operations; the applicability of technologies for recovery and production of the Company's oil and natural gas resources and reserves; the recoverability of the Company's oil and gas resources and reserves; future capital and exploration expenditures to be made by the Company; future sources of funding for the Company's exploration program; the geography of the areas in which the Company is exploring; and adequate weather and environmental conditions.
Actual results could differ materially from those anticipated in these forward-looking statements as a result of certain risk factors, including, but not limited to: general economic, market and business conditions; risks related to the exploration, development and production of oil and natural gas; risks inherent in the Company's international operations, including security and legal risks in Colombia; risks related to the timing of completion of the Company's projects; competition for, among other things, capital, the acquisition of resources and skilled personnel; actions by governmental authorities, including changes in government regulation and taxation; the failure of the Company to obtain the necessary approvals, permits and licences to conduct its operations; environmental risks and hazards; the availability of capital on acceptable terms; the failure of the Company or the holder of certain licenses or leases to meet specific requirements of such licenses or leases; adverse claims made in respect of the Company's properties or assets; failure to engage or retain key personnel; geological, technical, drilling and processing problems, including the availability of equipment and access to properties; failure by counterparties to make payments or perform their operational or other obligations to the Company in compliance with the terms of contractual arrangements between the Company and such counterparties; and the other factors discussed under the heading "Risk Factors" in the Annual Information Form and the Company's other continuous disclosure documents filed from time to time with applicable securities regulatory authorities in Canada and which may be accessed on PetroNova's SEDAR profile at www.sedar.com.
Readers are cautioned that the foregoing lists of factors are not exhaustive. The forward-looking statements included in this press release are expressly qualified by this cautionary statement and are made as of the date of this press release. The Company does not undertake any obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events or results or otherwise, except as required by applicable securities laws.
SOURCE PetroNova Inc.
For further information: Antonio Vincentelli, President & Chief Executive Officer, 954 317 3990, [email protected]; Stelvio Di Cecco, Chief Financial Officer, 954 317 3990, [email protected]; Abby Garfunkel, Investor Relations, 403-218-2887, [email protected]