Petrolifera: 1016 Well May Need Lift or Pump

Petrolifera Petroleum Limited reported late Monday that, subsequent to an announcement earlier in the day with respect to its RN.PM a-1016 well, wherein it was announced the well was flowing at a calculated rate of 460 bbl/d of light gravity crude oil, the well stopped flowing. This occurred during continued testing of the well using various choke sizes.

Testing procedures are continuing, and based on this development it now appears the well may need some form of artificial lift or pump, although no conclusion has yet been arrived at in this regard. The change that occurred may be due to a relatively high gas/oil ratio encountered in the well, along with some element of pressure depletion due to production from offset wells and general reservoir quality at this location.

While subject to the normal risks of predicting how any new well will perform, Petrolifera believes the well, on pump, will be a commercial producer and it may produce at or towards the levels recorded when the well was flowing, but further testing will now be required to confirm this estimate.

It should be noted that the indicated flow rate represents approximately four percent of Petrolifera's current average daily production rate, which will fluctuate over the next several days as field pressure testing of other individual Puesto Morales wells is undertaken as a normal course procedure.