Petro Vista Energy Corp. announced that it has successfully completed the acquisition of 90% of the quota capital of Petropuli Ltda. Through the Acquisition the Company has acquired a 47.42% working interest in an exploration and production agreement which grants oil and gas exploration and production over the 27,137 acre Morichito Block located in the East Plains, Llanos Basin, Colombia.
As consideration for the Acquisition, the company paid US$2,500,000 in cash, representing the final cash payment for the acquisition of the Quotas ($510,000 of which was paid directly to Petropuli Ltda. to pay down all of its existing liabilities. It also paid 1,777,549 common shares in the capital of the Company, representing that number of common shares equivalent to US$2,000,000 based on a closing price of the Company's common shares on the TSX Venture Exchange on June 30, 2008 of C$1.0186 to US$1.00 and issued an aggregate 4% Net Production Royalty over its proportionate production from the Morichito Block.
The Morichito Block which lies in the East Plains of the Llanos Basin encompasses 27,137 hectares. Prior to the acquisition, Petropuli had completed extensive 3D seismic work and an exploration well on the Morichito Block. Petropuli drilled the Morichito #2 well in late 2006, recovered oil, but was unable to complete the well at the time due to extenuating circumstances. Well logs from this well were analyzed both internally and by third-party petrophysical experts and showed potential high-quality reservoir sands found in field analog wells in the area producing, for instance, 1,350 bopd of 37 degree API oil .
Extensive work has also been completed on several additional exploration prospects in the block. The most promising is the Morichito #1N prospect which is along a productive NE SW trend in the area where field size reserves range from 6-10MMBO. An exploration well in the area will be drilled in Q4 2008.
Read B. Taylor, President and CEO of Petro Vista, commented, "We are pleased to add this interest in the Morchito Block to our portfolio as it is in line with our strategy of developing low-risk, proven exploration plays and drilling opportunities with significant upside potential. The economics of dealing in Colombia are enhanced by the favourable royalty regime and attractive fiscal terms set out by the Colombian Government."
He added, "With the acquisition, Petro Vista is continuing to meet our responsibility to our shareholders to aggressively build a portfolio of prospective assets. The Morichito Block acquisition is one of a number of opportunities the Company expects to announce in the next year, as it aims to participate in the drilling of up to 10 wells in Brazil and Colombia."
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