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CALGARY, June 18, 2012 /CNW/ - Valeura Energy Inc. ("Valeura" or the "Corporation") (TSX: VLE) is pleased to announce that it has been awarded two new exploration licences on a 100% working interest basis in southeast Turkey by the General Directorate of Petroleum Affairs of the Republic of Turkey ("GDPA"). These awards include Bostanci Licence 4985 at the juncture of the Syria and northern Iraq borders and Karakilise Licence 5052 near the city of Diyarbakir.
"We are delighted that the GDPA has awarded the Bostanci licence to Valeura", said Jim McFarland, President and Chief Executive Officer. "In our view this was the most prospective of the Rubai licences, which expired under a previous farm-in arrangement, and offsets a number of world-class oil discoveries in northern Iraq and Syria. Under a new licence term, we have the time to fully evaluate the prospectivity of Bostanci. The Karakilise licence is also a great complement to our existing position in two other contiguous licences and establishes Valeura as an operator in this very active area."
BOSTANCI LICENCE 4985
Bostanci Licence 4985 covers an area of 123,051 gross acres and encompasses the same area previously designated as Licence 2600 in which Valeura and partners had spudded the Bostanci-1 well in April 2011 as a farm-in commitment well, only to have the licence cancelled due to a failure to meet the petroleum district's spudding deadline. Valeura immediately reapplied on May 12, 2011 for Licence 4985 only. Under a pre-bidding arrangement, Exile Resources Inc. ("Exile"), the other funding partner in the Bostanci-1 well, has a right to a 50% participating interest in the license.
The Bostanci-1 well, located adjacent to the northern Iraq border, was spudded on April 24, 2011 and was drilled to a depth of 508 metres where surface casing was set. Upon cancellation of the licence, the well was temporarily suspended with a 50 metre cement plug at the base of the well. The Corporation believes that the well could be re-entered to continue drilling. The primary exploration target at the time was the Mardin Group at a depth of 3,300 metres.
The Corporation believes that the Bostanci prospect remains an attractive target. Valeura had co-funded 60 km of new 2D seismic on and around the Bostanci surface anticline and carried out a structural modelling study of the area to locate the Bostanci-1 well. A number of very large producing oil fields offset Bostanci including the Tawke field 35 km east in northern Iraq and the Karatchok field 12 km southwest in Syria. Over the next few months, the Corporation will be updating its assessment of the Bostanci prospect and the timing, cost and funding of an initial exploration well.
KARAKILISE LICENCE 5052
Karakilise Licence 5052 covers an area of 122,965 gross acres and is contiguous with Licences 2674 and 2677, in which Valeura has a 27.5% working interest.
The area is prospective for heavy oil in the Mardin Group and light oil in the Bedinan Formation with a number of discoveries in the area. More recently there has been growing interest in unconventional oil and gas exploitation in the Dadas Shale source rock which sits above the Bedinan Formation. A number of companies are active in the area, including most recently Shell which has farmed-in on several licences held by TPAO, the Turkish national oil company, to the north and contiguous with Licence 2677.
Valeura has been active in this area since late 2010 and has shot 227 km of 2D seismic, carried out a successful well recompletion in the Mardin Group in the Karakilise-1 well on Licence 2677 and drilled a Mardin Group and Bedinan Formation discovery in the Altinakar-1 well on Licence 2674. Valeura and its partners are currently producing the Altinakar-1 well at a rate of 10 to 13 barrels of oil per day (gross) from the Bedinan and a potential fracture stimulation program is under review to improve well productivity. The up-hole Dadas Shale and additional pay in the Mardin Group may also be tested in the Altinakar-1 well. Additional 2D seismic is planned in 2012 prior to any additional drilling in the area.
ABOUT THE CORPORATION
Valeura Energy Inc. is a Canada-based public company currently engaged in the exploration, development and production of petroleum and natural gas in Turkey and Western Canada.
CAUTION REGARDING FORWARD-LOOKING INFORMATION
This news release contains certain forward‐looking statements including, but not limited to the extent and timing of the seismic, frac and drilling program on the Bostanci Licence 4985 and the Karakilise licences. Forward‐looking information typically contains statements with words such as "anticipate", "estimate", "expect", "potential", "could", "would" or similar words suggesting future outcomes. The Corporation cautions readers and prospective investors in the Corporation's securities to not place undue reliance on forward‐looking information, as by its nature, it is based on current expectations regarding future events that involve a number of assumptions, inherent risks and uncertainties, which could cause actual results to differ materially from those anticipated by the Corporation.
Forward looking information is based on management's current expectations and assumptions regarding, among other things: continued political stability of the areas in which the Corporation is operating and pursuing transactions; continued operations of and approvals forthcoming from the GDPA in a manner consistent with past conduct; results of seismic programs; future drilling, well completions and frac'ing activity and results; future capital and other expenditures (including the amount, nature and sources of funding thereof); future economic conditions; future currency and exchange rates; and, the Corporation's continued ability to obtain and retain qualified staff and equipment in a timely and cost efficient manner. Although the Corporation believes the expectations and assumptions reflected in such forward‐looking information are reasonable, they may prove to be incorrect. The transfer of a working interest in Bostanci Licence 4985 to Exile will be subject to GDPA approval.
Forward‐looking information involves significant known and unknown risks and uncertainties. Exploration, appraisal, and development of oil and natural gas reserves are speculative activities and involve a significant degree of risk. A number of factors could cause actual results to differ materially from those anticipated by the Corporation including, but not limited to: risks associated with the oil and gas industry (e.g. operational risks in exploration, inherent uncertainties in interpreting geological data, and changes in plans with respect to exploration or capital expenditures, the uncertainty of estimates and projections in relation to costs and expenses, and health, safety, and environmental risks); the uncertainty regarding the sustainability of initial production rates and decline rates thereafter and the ability to improve well productivity; the risk of commodity price and foreign exchange rate fluctuations; the uncertainty associated with negotiating with third parties in countries other than Canada; the uncertainty regarding Exile's intention to acquire an interest in the Bostanci Licence; the uncertainty regarding future financing and market conditions; the risk of partners having different views on work programs and potential disputes among partners; the uncertainty regarding government and other approvals; the risks associated with weather delays and natural disasters; and, the risk associated with international activity. The forward‐looking information included in this news release is expressly qualified in its entirety by this cautionary statement. The forward‐looking information included herein is made as of the date hereof and Valeura assumes no obligation to update or revise any forward‐looking information to reflect new events or circumstances, except as required by law.
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For further information:
Jim McFarland, President and CEO
Valeura Energy Inc.
Steve Bjornson, CFO
Valeura Energy Inc.