Pacific Rubiales in significant Peruvian oil find


Pacific Rubiales in significant Peruvian oil find

TORONTO -- Pacific Rubiales Energy Corp. has announced well test results from the Los Angeles-1X well, located in Block 131, and provided an update on its Block 126. Both are located in the onshore Ucayali basin in Peru. The company gained its interest in both blocks through the Petrominerales Ltd. acquisition completed in late 2013.

Ronald Pantin, the company's CEO, commented, "The company is very encouraged by the test results in the Los Angeles 1X well in Block 131 and is looking forward to progressing this discovery and the earlier Sheshea-1X oil discovery in Block 126 through an evaluation phase and future development and production. These light oil discoveries support our confidence in the potential of the under-explored onshore basins in Peru."

Pacific Rubiales, through its wholly-owned subsidiary Pan Andean Resources Plc (Perú), Sucursal del Perú, holds a 30% working interest in Block 131 in Peru. The company, in joint operations with the operator CEPSA Peru S.A., has now carried out the third phase of exploration in the block. The operator carried 100% of the well costs and will retain the remaining 70% working interest. The Los Angeles 1X well in Block 131 was spud in mid-September, 2013 and reached a total depth of 12,409 ft in late November. Petrophysical evaluation indicated the presence of 62 ft of net pay in the Cretaceous aged Cushabatay formation.

Three separate tests have now been conducted across different net pay intervals in the Cushabatay formation under swabbing and natural flow conditions and through variable choke sizes over 22 to 60 hour test periods. Final flow rates from the three test intervals were 135 bbl/d, 936 bbl/d and 2,351 bbl/d respectively of 44° to 45° API light sweet oil. Water cuts ranged from 10% in the lowest interval to 0.3% to nil in upper intervals.

The produced oil was trucked and sold to the nearby Pulcallpa refinery in Peru. The operator has applied for a 30 day initial production test to further understand the reservoir drive mechanism to be followed by an extended production test beginning in mid-2014. Both companies are currently evaluating development and oil marketing strategies for the block.

The Sheshea-1X exploration well was drilled to a total depth of 8,925 ft in late 2012 and tested 1,430 bbl/d of 53° API light sweet oil with no water from a ten foot perforated zone in the Cretaceous aged Chonta formation. The Cretaceous aged Agua Caliente Formation tested 80 bbl/d of 42° API with a 97% water cut suggesting a potential accumulation updip from the well. The company holds a 100% operated working interest in Block 126 and has recently applied for two Environmental Impact Assessments (EIA) in order to progress the discovery to an evaluation phase followed by the expected development of the discovery. The first EIA is for 23 drilling pads, comprised of 8 wells each plus a 2D and 3D seismic program. The second EIA is primarily for early production facilities.

The company expects to receive the approval of these EIA's by the end of 2014.

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