Brownstone Ventures Inc. provided an update received from the operator, Petrolifera Petroleum Limited with respect to its 253,000 acre (approximately 1,025 square kilometers) Vaca Mahuida Block in the province of Rio Negro, Argentina.
Petrolifera has advised that approximately 70% of the 1,150 km2 3D seismic acquisition has been completed and that the full acquisition program will be completed by late June. Interpretation and processing is expected to take 3 months following completion of the 3D seismic program.
To date, using existing 3D seismic data, Petrolifera has identified two strat/structural Rinconada-like prospects for the Sierras Blancas, which if successful may have considerable lateral extent. These two locations are drill ready. A third location, a structural play in the Sierras Blancas, is presently undergoing site preparation and environmental approvals. A drilling rig has been secured and the anticipated spud date on the first well is late July, with the second and third wells to follow shortly thereafter. In total, as many as 5 wells may be drilled in fiscal 2008.
Under the terms of the participation agreement between Brownstone and Petrolifera, Brownstone is earning a 25 percent working interest by incurring 50 percent of the costs of the Vaca Mahuida program which includes the reprocessing of 560 square kilometers of existing 3D seismic; the acquisition of a minimum of 1,150 square kilometers of new 3D seismic over the block; and the drilling of 12 new wells to depths ranging from 1,000 to 1,500 meters, all over a three year period.
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