Maple Energy has provided an update on its ongoing drilling operations, including its first well in the Santa Rosa prospect in Block 31-E in Peru (the "Santa Rosa 1X Well"). The Company is also announcing its intention to implement a cost reduction program in the near term.
Santa Rosa 1X Well
Maple is pleased to announce that it has achieved total depth of approximately 13,000 feet on the Santa Rosa 1X Well. The Company has drilled the second prospective interval in the Santa Rosa 1X Well, the Paleozoic Period formations, and has reached the Devonian shales at total depth in this interval. Preliminary drilling results indicate gas shows in certain Paleozoic Period sands and no oil shows. Additional information and evaluation of the zones with gas shows is required to determine whether the Santa Rosa 1X Well is a commercial discovery. The Company will test and further evaluate these zones within the next three weeks to determine if the zones contain commercial quantities of hydrocarbons and will report on the results as soon as the information is available.
Cost Reduction Program
The Company has recently concluded an internal review to determine where opportunities exist to reduce costs while maintaining operations in each of its existing business units. As a result of this review, Maple has identified a number of cost-saving alternatives and will implement a significant cost reduction program in September. The Company expects to save up to US $4 million per year as a result of this program.
Development Drilling Program
Maple has completed the drilling of eleven wells in its Block 31 B&D development program, including the completion of five development wells in the Maquia oil field and six development wells in the Agua Caliente oilfield. Additional works are planned for certain of these wells to further increase production. The Company will complete all works on the first 11 wells in the program and evaluate the results prior to drilling any additional wells in its ongoing development drilling program. Maple expects to complete the works and evaluation of its first 11 wells by early 2010.
Rex Canon, CEO of Maple Energy, commented today, "I am pleased to report that Maple continues to make progress with its operations. The news from Santa Rosa is encouraging although clearly further evaluation is required. We have also conducted an internal review and believe we can make significant cost cuts that will increase cash flow and make us a more efficient company."
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