September Production 753 boed; Workover and Reactivation Continues on 29 future wells
VANCOUVER, Nov. 13, 2017 /CNW/ - PentaNova Energy Corp. (the "Company") (TSXV: PNO), which seeks to become Latin America's next significant oil and gas developer, is pleased to announce operational advances on its Colombian and Argentine properties.
September 2017 Production in Argentina Averages 753 boed
PentaNova reports September 2017 production in Argentina of 753 boepd, from 52 active wells. This includes 498 bopd from the Llancanelo heavy oil block where the Company holds a 39% working interest, and 208 boepd from the Mariposa gas block in the San Jorge Basin of Argentina in which the Company holds an 18% interest, and 47 bopd from the KM8 field in which the Company holds a 100% interest. A further 29 wells in the Argentina's KM8 property have been developed to be prepared for workover and reactivation.
Negotiations Finalized to Move to the Full 50% Working Interest to Develop Argentina's Llancanelo Heavy Oil Field in Partnership With YPF, Argentina's National Oil Producer
PentaNova has now completed the negotiations to complete the planned move to 50% working interest in the Llancanelo field through its fully owned subsidiary, Alianza Petrolera, through which it already holds a 29% working interest. The Company has also finalized the transfer of the 10% working interest acquired through the Roch Acquisition as announced in the Company´s May 3, 2017 press release. Additionally, the Company has completed negotiations with YPF, Argentina's largest energy producer, to farm-in on an additional 11% working interest in the block. The farm-in terms include an initial period of up to 6 months for the partners to complete a joint planning and evaluation program to complete the full development plan on the block, and will see the Company jointly develop the technical plans to take the block from its current 1,277 boepd (September average production) with YPF into a large heavy oil development. The Company will move to the full 50% working interest automatically when customary closing conditions are completed, including those associated with the transfer of the block with the Province of Mendoza.
"The decision of YPF, Argentina's largest energy producer, to deepen its partnership with PentaNova is a significant advancement for our Company's strategic plan to become Latin America's next significant oil and gas company," said PentaNova Chairman and Executive Director Serafino Iacono. "We are also pleased that as we develop one of Argentina's largest heavy oil fields, PentaNova continues to generate revenue and execute plans to reactivate wells on KM8 enabling that field to move back into active development."
The Llancanelo area is located to the north of the Neuquén Basin, in a basin-edge position in the province of Mendoza, 37 km southeast of the city of Malargüe. The Llancanelo field was discovered by YPF in 1937 after drilling two exploratory wells that tested oil in the Tertiary levels. Thirteen deviated wells were drilled in 2016 into a large heavy oil body and the field produced an average of 1,277 boepd during the month of September from conventional cold flow horizontal wells.
The Company, in close cooperation with partner YPF, is currently embarking on a joint program to further evaluate the field, continue to optimize the existing operations, and to evaluate technologies to enhance the productivity of wells — all in preparation of a new development drilling program to be initiated in the new year. The plan will draw on PentaNova management's vast experience in developing heavy oil assets, and include the evaluation and implementation of techniques that have proven to be highly successful in similar reservoirs in other heavy oil prone regions such as Canada, Venezuela and Colombia. The partners are currently planning to mobilize a coil tubing unit into the field to complete workover and testing activities.
Maria Conchita Drilling Program and Pipeline Plans Advance in Colombia
The Maria Conchita work program is advancing well, with civil work well underway. Mobilization of the drilling rig that is under contract will start in approximately three weeks. Additionally, the Company has received confirmation from five companies that they will provide a proposal for construction and financing of the pipeline to tie the wells into the national gas grid.
Discussions Underway to Map Out Sinu-9 Development Program
American Oil and Gas farmed-in for half of PentaNova's 80% beneficial working interest in the Sinu- 9 block, and has provided a US$ 2.4 million non-refundable cash payment. Further to the farm-out LOI announced by PentaNova and American Oil and Gas on September 28, 2017, the companies have initiated detailed technical discussions to establish the joint work program to be conducted on the 313,639 acre block in the Lower Magdalena Valley Basin of Colombia, where PentaNova will continue to act as operator.
Offers Being Considered To Accelerate Reactivation of 29 KM-8 Wells in Argentina
PentaNova has developed 29 candidate wells for workover and reactivation. An initial campaign of 11 wells is being finalized for implementation. The Company has also completed initial planning on candidate wells for a drilling program that is expected to be initiated early in 2018, targeting both the shallow Glauconitica formation, and the medium Comodoro Rivadavia and Mina del Carmen productive formations. PentaNova has received offers from service companies to provide equipment and services on the field on deferred payment plans, or paid out of production. The Company is currently reviewing these offers to determine the optimal way to accelerate the redevelopment program.
About PentaNova Energy Corp.
PentaNova Energy Corp. is a publicly traded E&P company focused on proven oil & gas plays in Latin America. The Company holds a large diversified portfolio of unexploited assets in Colombia and Argentina, where it will leverage its amplitude of technical expertise and proven track record building companies and creating value.
Except for the statements of historical fact, this news release contains "forward-looking information" within the meaning of the applicable Canadian securities legislation that is based on expectations, estimates and projections as at the date of this news release. The information in this news release about the completion of the operations described herein, and other forward-looking information includes but is not limited to information concerning the intentions, plans and future actions of the parties to the transactions described herein and the terms of such transaction.
Factors that could cause actual results to differ materially from those described in such forward-looking information include, but are not limited to, risks related to the Company's inability to perform the proposed operations.
The forward-looking information in this news release reflects the current expectations, assumptions and/or beliefs of the Company based on information currently available to the Company. In connection with the forward-looking information contained in this news release, the Company has made assumptions about the Company's ability to complete the planned operations and activities. The Company has also assumed that no significant events will occur outside of the Company's normal course of business. Although the Company believes that the assumptions inherent in the forward-looking information are reasonable, forward-looking information is not a guarantee of future performance and accordingly undue reliance should not be put on such information due to the inherent uncertainty therein.
Any forward-looking information speaks only as of the date on which it is made and, except as may be required by applicable securities laws, the Company disclaims any intent or obligation to update any forward-looking information, whether as a result of new information, future events or results or otherwise.
Neither the TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.
SOURCE PentaNova Energy Corp.
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