PetroMagdalena Energy Corp. on Monday announced that it has discovered a new light oilfield with the Copa B-1 exploration well, with the well testing 1,045 bopd of 39.3 degrees API light oil over the initial 3-day production test. This represents 597 bopd gross working interest share for the Company.
Luciano Biondi, Chief Executive Officer of PetroMagdalena stated, "I am excited as this has a direct impact on our bottom line and follows directly after our Petirrojo-1 discovery, which has produced at an average of 1,831 bopd over the past 20 days. This is a very positive drilling result as it significantly improves the potential of the remaining exploration acreage on the Copa trend in the Cubiro block, our core producing asset in Colombia, and the rig is now moving to spud the Copa AS-1 exploration well."
Located in the Cubiro Block of the Llanos Basin, the Copa B-1 well, in which the Company holds a 57% working interest, was spudded on August 18, 2011 and directionally drilled to a total depth of 6,862 feet measured depth ("MD"). The top of the C5 and C3 Carbonera sections were encountered at depths of 5,251 feet (MD) and 5,045 feet (MD), respectively. Well logs indicate a total of 41 feet of net oil sand, 24 feet in three C5 sands, and 17 feet in two C3 sands. Porosities range from 24% to 28% in the C5 and 27% to 29% in the C3 sands. After perforating 17 feet in the two lower C5 sands and installing an electric submersible pump ("ESP"), the well produced at an average rate of 1,067 bopd of 39.3 degrees API oil over the latest 24-hour period at a BS&W of 0.9% and a downhole pump intake pressure of 1623 psi, a 23.2% drawdown. The well testing program is ongoing and final results will be provided.
Based on seismic interpretations, the accumulation discovered by Copa B-1 is a 1.3 kilometer-long structure with an estimated closure of 140 acres, corresponding to the typical exploration play in the Llanos Basin. The Copa B structure is on trend with the Company's Copa Field, 4 kilometers to the north, which was brought on production last year with the Copa-1 well, which was completed in two C5 sands from the same stratigraphic level as the ones tested in Copa B-1 well, and has produced 200,000 barrels of 40 degrees API oil over the past 16 months.
In Cubiro Block C, the Company is currently moving the drilling rig to drill the Copa AS-1 exploration well from the same operating pad with a target total depth of 7,716 feet (MD). Copa AS-1 will test a similar structure as Copa B, on trend with the Copa Field and immediately north of the Copa B discovery. Once the drilling of the Copa AS-1 well is terminated, a work over rig will be mobilized to test this well and the rest of the C5 and C3 sands penetrated by the Copa B-1 well.
The Petirrojo-1 discovery has produced at an average rate of 1,831 bopd (Company share, 1,282 bopd before royalties) over the past 20 days with a sustained pump intake pressure.
On August 31, 2011, Trayectoria Oil & Gas, the operator for the Topoyaco Block, spudded the Yaraqui-1X well in the central part of the block. The well is planned to reach a total depth of 10,509 feet MD, or 9,402 feet true vertical depth (TVD), or 8,484 feet TVDSS, and is targeting the Cretaceous Villeta and Caballos formations in a sub-thrust structure called Prospect "D". This prospect is a sub-thrust structure independent from previously drilled structures "B" and "C" in the block. Pacific Rubiales Energy Corp. recently announced that preliminary prospective resources (best estimate) for Prospect "D" are 51 MMbbls.
As previously announced, Pacific Rubiales has requested the approval of the ANH to become the operator of the Topoyaco Block, which approval remains pending.
SENIOR SECURED SERIES A NOTES AND ACCOMPANYING WARRANTS
On September 8, 2011, 31,050 senior secured series A notes and 1,330,714 share purchase warrants, issued pursuant to the Company's debt financing of C$31,050,000 that closed on May 5, 2011, began trading on the TSX Venture Exchange under the symbols "PMD.DB" and "PMD.WT", respectively.
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