Black Rock Oil Begins Drilling on Arce Field in Colombia
Black Rock Oil reports that drilling operations on the Acre 4 development well has commenced by its joint venture partner, Kappa Resources Colombia Limited. The rig arrived on site last week and the Arce 4 well has now been spudded.
Arce 4 is expected to take 15-20 days to drill, test and complete. Subsequently the drill rig will be moved to Arce 2 where the gravel pack will be replaced.
In addition, the Company confirms that the steam generator is expected on site at the Arce field by early July and that preparation is being made for the steam testing program to commence. Steam injection and production is a proven technique used in Colombia to increase oil flow by lowering the oil viscosity and is being use for production in adjacent fields. As set out in the Company's Annual Report and Accounts for the year ended 30 June 2005, the Arce field has estimated recoverable reserves in excess of 5 million barrels of which the Company has a 50% equity.
Testing is also scheduled on the Baul field within the license area in the coming months. The Baul well was previously on commercial production but shut-in in 1961 due to the then prevailing low oil price. If the well is in good condition, it will be tested with a view to potentially declaring commerciality during 2006.
Ivan Burgess, Managing Director of Black Rock Oil & Gas plc, commented:
"Our aim remains to book reserves in excess of 2.5 million barrels and to generate cashflow in the second half of 2006. We are optimistic that the Arce field will be in commercial production later this year.
"The spudding of Arce-4 represents the first stage of our development, appraisal
and exploration program in 2006 and the Arce steam testing project should
start to generate cash flow for the Company later this year."
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