Pacific Rubiales Energy Corp. (TSX: PRE) (BVC: PREC) (BOVESPA: PREB) announced today the successful results of the first production tests in the CPE-6-1X exploration well and the CPE-6-H2 appraisal well, two new wells drilled during December in the CPE-6 Block in the Eastern Llanos Basin, onshore Colombia. Pacific Rubiales has a 50% working interest and is operator of the block. Talisman (Colombia) Oil and Gas Ltd., a wholly owned subsidiary of Talisman Energy Inc. (TSX: TLM) (NYSE:TLM) holds the remaining 50% working interest.
The CPE-6-1X vertical exploration well was drilled to a total depth of 3,318 feet MD in the Hamaca prospect, targeting the Basal Sand Unit of the Carbonera Formation, a unit that has shown a significant hydrocarbon column in 12 stratigraphic wells drilled in the block by the Company and its partner since 2010. The petrophysical evaluation of the well indicates a total of 50 feet of net pay averaging 30% porosity across a gross interval of 90 feet. The well was cased and completed in the net pay interval and tested at an average flow rate of 222 bbl/d of 10.8° API oil with a 15% water cut, tested over a five day period.
The CPE-6-H2 vertical appraisal well was drilled to a total depth of 3,485 feet MD, targeting the Basal Sand Unit of the Carbonera Formation. The well is located four kilometers northeast of the CPE-6-1X well and is also drilled in the Hamaca prospect. The petrophysical evaluation of the well indicates a total of 34.5 feet of net pay averaging 29% porosity across a gross interval of 80 feet. The well was cased and completed in the net pay interval and tested at an average flow rate of 213 bbl/d of 10.9° API oil with a 12% water cut, tested over a three day period.
Both wells were completed using an open-hole gravel pack technique. No thermal stimulation was required and both wells responded well to the use of submersible pump lift. The CPE-6-1X well fulfils the commitments for the first exploration phase of the CPE-6 E&P contract.
Ronald Pantin, the Company's Chief Executive Officer, commented:
"These are very good results, both wells exceed the production rate of an average vertical well in the Rubiales Field, and fully endorse our confidence in the oil potential of the CPE-6 Block and the repeatable scalable nature of the heavy oil resource play in Colombia. From our extensive experience in operating and developing the neighbouring Rubiales and Quifa SW heavy oil fields, we find that horizontal wells typically flow at up to six to ten times the rate of a vertical well.
"We have now established our first two producing wells on the CPE-6 Block. The Company will be moving a third rig into the CPE-6 Block in early 2014 and plans to drill 16 development wells and nine exploration and appraisal wells during the year. We are in the process of moving modular production equipment into the block to accommodate the expected early production. In early November, the Company was granted the global environmental license for the CPE-6 Block which allows us to drill 200 wells (including exploration, appraisal, development and injection wells) on 40 pads and also build surface facilities for future field development expansion.
"Over the past six years, Pacific Rubiales has been the leading explorer and developer of heavy oil reserves and production in Colombia with its giant Rubiales and Quifa oil field developments, and has established one of the largest acreage positions along Colombia heavy oil resource trend. With its 50% and 100% respective working interests in the CPE-6 and Rio Ariari blocks, both located southwest of the Rubiales/Quifa SW fields along Colombia's heavy oil resource trend, the Company now has a clear path to replace the Rubiales Field production by 2016."
At year-end 2012, the Company booked certified net 2P reserves of 44.5 MMbbl associated with the Basal Sand Unit in the Hamaca prospect, located in the north central portion of the CPE-6 Block, and additional working interest gross best case Prospective Resources of 137.1 MMbbl for this unit. The 2012 certification does not include an evaluation of the overlying C-7 sand where additional potential oil pay has been identified on petrophysical logs in wells drilled in the block.
Pacific Rubiales, a Canadian company and producer of natural gas and crude oil, owns 100% of Meta Petroleum Corp., which operates the Rubiales, Piriri and Quifa heavy oil fields in the Llanos Basin, and 100% of Pacific Stratus Energy Colombia Corp., which operates the La Creciente natural gas field in the northwestern area of Colombia. Pacific Rubiales has also acquired 100% of Petrominerales Ltd, which owns light and heavy oil assets in Colombia and oil and gas assets in Peru, 100% of PetroMagdalena Energy Corp., which owns light oil assets in Colombia, and 100% of C&C Energia Ltd., which owns light oil assets in the Llanos Basin. In addition, the Company has a diversified portfolio of assets beyond Colombia, which includes producing and exploration assets in Peru, Guatemala, Brazil, Guyana and Papua New Guinea.
