GeoPark Holdings Limited ("GEOPARK") has announced the discovery of a new oil field on the Fell Block in Chile following the successful drilling and testing of the Alakaluf 1 exploration well. GEOPARK operates and has a 100% working interest in the Fell Block.
GEOPARK drilled and completed the Alakaluf 1 well to a total depth of 2,240 meters. A production test in the Springhill formation, at approximately 2,174 meters in a 10.5 meter perforated interval, flowed without stimulation, at a rate of approximately 1,460 barrels per day (bpd) of oil, 0.4 million cubic feet per day (mmcfpd) of gas and 45 bpd of water through a choke of 10 millimeters (mm) and with a well head pressure of 696 pounds per square inch (psi) during a 24 hour production test. Total thickness of the Springhill reservoir in this structure was approximately 19 meters. These are preliminary results and further production history will be required to determine stabilised flow rates from this well and the extent of the reservoir. The produced oil (approximately 32 degrees API) is currently being trucked to a tank facility near the Fell Block and sold to ENAP -- the Chilean State oil company.
GEOPARK's activities are principally focused on its Fell Block in Chile where it completed a US$57 million capital expenditure program in 2008 -- including the drilling of 14 new wells, a new 3D seismic survey and expansion of its production infrastructure. During 2008, GEOPARK began production from nine new wells in Chile -- which included four new field discoveries. Three recently drilled and cased wells (Yagan 1, Aonikenk 2 and Monte Aymond 33) are planned to be tested during this quarter. In addition to its Fell Block operations, GEOPARK recently acquired two new large blocks in Chile (Tranquilo and Otway blocks covering an area of approximately 12,000 square kilometres) where it will begin work and operate on behalf of international consortia in Q12009. (The Tranquilo Block has been approved by the Chilean government and the Otway Block is currently undergoing Chilean regulatory approval).
Commenting, Gerald E. O'Shaughnessy, Chairman of GEOPARK, said, "We are very pleased with these production rates from the Alakaluf oil discovery. In addition to representing another important increase in both revenues and oil and gas reserves of the Company -- as well as continuing our team's exceptional oil and gas finding rate -- this new oil production will provide a strategic balance to our overall oil and gas production and sales mix. The Alakaluf oil discovery also continues to open up the new oil region in the northeast portion of the Fell Block first discovered with the Aonikenk field discovery in 2008."
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