CALGARY, Feb. 3, 2014 /CNW/ - Stream Oil & Gas Ltd. (TSXV: SKO) ("Stream" or the "Company") is pleased to provide an update regarding the status of its Delvina gas project. The drilling rig for the first Delvina horizontal gas development well (D34H1) arrived in Albania, cleared customs and is en route to the Delvina gas field for an expected spud date in March 2014. Concurrently, Stream is pursuing various strategies to bring the existing Delvina D12 and D4 gas wells on line.
Delvina Horizontal Well Status
The hydraulic rig for drilling of the D34H1 gas well arrived at the Durres port in Albania at the end of January 2014. Over the past few months, Stream completed all preparatory work at the wellsite, including the necessary local support facilities. The D34H1 well is expected to spud during March 2014 and test in June 2014 after finalization of drilling and completions operations.
The produced residue gas from the D34H1 well will be delivered to the power generation unit installed at Delvina through a new 500 metre pipeline connection. At the same time, Thermo Energy Albania is planning to increase the megawatt power potential of the unit. Condensate production from the well will be also sold initially to the local market. This will enable a longer term test of the well to provide additional assurance of the well's production potential.
Delvina Gas Status
Stream reopened the Delvina D12 well in mid-2013 to commence production and gas sales following completion of the first stage of the thermal power plant in late 2013. During workover operations an obstruction was encountered in the completion string that could not be removed through solvent injection. The Company is currently focused on attempting to clear the blockage by disengaging the packer. In addition, Stream completed upgrades to the Delvina D4 well during late 2013 and a program is in its final stages to bring the well back on line. If work on both wells is successful, production could commence prior to the end of February 2014.
"The dedicated Delvina gas operations team has been focused to repairing the existing vertical gas wells and ensuring the field is prepared for horizontal drilling," said Dr. Kapotas, President and Chief Executive Officer. "Despite delays experienced in 2013, we believe that we now have all the necessary equipment and experience in place to move ahead with Delvina gas production in the near future. The drilling rig for the horizontal well will later be used to drill our Delvina Block exploration well later in 2014."
Information in this news release respecting matters such as plans of development or exploration, reserves estimates, production estimates and targets, development costs, work programs and budgets constitute forward-looking information (collectively, "forward-looking statements") under the meaning of applicable securities laws, including Canadian Securities Administrators' National Instrument 51-102 Continuous Disclosure Obligations. Such forward-looking information is based on certain assumptions, including the availability of funds for capital expenditures necessary to construct the infrastructure required for future development, a favorable political and economic operating environment, a consistent rate of well re-completions and costs, success rates, production performance and build-up periods for well re-completions that are consistent with or an improvement over historical levels.
The forward-looking statements contained herein are made as of the date of this release solely for the purpose of generally disclosing Stream's results and status of its Delvina gas project. Investors are cautioned that these forward-looking statements are neither promises nor guarantees, and are subject to risks and uncertainties that may cause future results to differ materially from those expected. Such forward-looking information reflect management's current beliefs and are based on assumptions made by and information currently available to the Company, and involves known and unknown risks, uncertainties and other factors which may cause the actual costs and results of the Company and its operations to be materially different from estimated costs or results expressed or implied by such forward-looking statements. Such factors include, among others political and economic risks associated with foreign operations, general risks inherent in petroleum operations, risks associated with equipment procurement and equipment failure, availability of qualified personnel, risks associated with transportation, currency and exchange rate fluctuations and other general risks inherent in oil and gas operations.
Although the Company has attempted to take into account important factors that could cause actual costs or results to differ materially, there may be other factors that cause costs and timing of the Company's program or results not to be as anticipated, estimated or intended. There can be no assurance that such statements will prove to be accurate as actual results and future events could differ materially from those anticipated in such statements. Accordingly, readers should not place undue reliance on forward-looking information. These forward-looking statements are made as of the date hereof and the Company does not assume any obligation to update or revise them to reflect new events or circumstances except as required under applicable securities legislation.
Use of Boe Equivalents
The oil and gas industry commonly expresses production and reserve volumes on a barrel of oil equivalent (Boe) basis whereby natural gas volumes are converted at the ratio of six thousand cubic feet of natural gas to one barrel of oil. Boe may be misleading particularly if used in isolation. A Boe conversion ratio of 6 Mcf: 1 Bbl is based on an energy equivalency conversion method primarily applicable at the burner tip and does not represent a value equivalency at the wellhead.
About Stream Oil & Gas Ltd.
Stream Oil & Gas Ltd. is a Canadian-based emerging oil and gas production, development and exploration company focused on the re-activation and re-development of three oilfields and a gas/condensate field in Albania. The Company's strategy is to use proven technology, incremental and enhanced oil recovery techniques to significantly increase production and reserves.
Neither 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.
SOURCE: Stream Oil & Gas Ltd.
For further information:
Dr. Sotirios Kapotas President & Chief Executive Officer P: (403) 531-2358
Susan J. Soprovich, Interim Corporate Secretary P: (403) 874-2903
Email [email protected]