Platino Energy Corp. Provides Operations Update
September 9, 2013 (Source: Marketwire) — Platino Energy Corp. (“Platino” or the “Company“) (TSX VENTURE:PZE) is pleased to provide an update on the ongoing testing of the Coati-1 well, an operations update regarding the Company’s exploration properties and a year-end 2013 capital outlook.
Coati Block – 100% Working Interest(1)
The Coati-1 well was cased to a total planned depth of 10,800 feet in late July 2013 after 42 days of drilling. Testing activity with the rig has been extensive, including preliminary tests of the Caballos and Villeta U Sandstones and the Caliza A Limestone. The Company is currently completing the Coati-1 well for further production testing using sliding sleeves and a jet pump to test production independently from the upper and lower Caballos Sandstones, the Villeta U Sandstone and the Caliza A Limestone.
Production testing undertaken in the coming weeks will determine whether commercial volumes of oil can be produced from these formations. The drilling rig has been released and testing will continue via wireline. A jet pump will be installed to perform an extended test on the Caliza A Limestone followed by extended testing of the two Caballos Sandstones. Platino will release test results upon completion of the extended testing program.
Depending on results from the extended testing of Coati-1, Platino and its partner Canacol Energy Ltd. (“Canacol“) will define an appraisal program for the Coati structure. The Nasua structure, north of Coati-1, was upgraded to a prospect based on the Coati-1 well results. The licensing process is underway to drill and potentially shoot a 3D seismic survey over the Nasua structure in 2014.
Platino currently holds a 100% working interest in the Coati block, with its interest reducing to 80% once Canacol earns a 20% interest pursuant to agreed farm-in terms.
|(1)||Platino’s interest in the Coati block is a result of the spin-off of certain exploration assets formerly belonging to C&C Energia Ltd. to Platino. Platino is pursuing regulatory approval from the ANH (as defined below) to be recognized as operator of record of the Coati block.|
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Putumayo-8 Block – 50% Working Interest
Platino and its operating partner, Vetra Exploracion y Produccion S.A.S. (“Vetra“), are continuing work for the first exploration well and design of the seismic program for the remaining 112 km2 of 3D seismic commitment as required under the first phase of the Putumayo-8 exploration and production contract. Due to delays in environmental licensing, the Company expects the drilling of the first exploration well to be delayed until the latter half of 2014. The expiration of the first phase is May 2014, necessitating the operator to request an extension of the current phase from the Agencia Nacional de Hidrocarburos (“ANH“), which the Company does not anticipate being problematic.
Vetra announced on July 30, 2013 that it will be jointly acquired by Capital International Private Equity Fund VI, L.P. and an affiliate of Acon Investments LLC.
Andaquies Block – 100% Working Interest
The previously announced transfer of Canacol’s 36% working interest in the Andaquies block to Platino has been completed, and Platino’s working interest is now 100%.
The Company is actively pursuing a new partner for the Andaquies block, after which it plans to shoot a 3D seismic survey. All required ANH commitment spending has been completed on the Andaquies block, allowing the Company until August 2016 to plan and execute a seismic survey and any potential future drills.
As previously announced, Platino has assigned (subject to ANH approval) its 50% interest and operatorship in the Morpho block to Parex Resources Inc. in return for a 4% net profit interest royalty in the block.
2013 Capital Outlook and Financial Liquidity
As a result of licensing delays at the Putumayo-8 block and the transfer of the Company’s working interest in the Morpho block, the Company expects capital spending to be limited to the Coati block for the remainder of 2013. A summary of estimated spending for the remainder of 2013 is presented below. Based on current cash and cash equivalents (including short-term investments) and the activities projected for the remainder of 2013, the Company estimates it will exit 2013 with approximately US$60 million in available funds.
|(US$ millions)||H1 2013A||H2 2013E||2013E|
|Civil & HSEC||2.6||–||2.6|
|Completion & initial testing||–||4.4||4.4|
|Long-term testing (1)||–||2.4||2.4|
|Total Capital Investments||$6.7||$9.1||$15.8|
|General and administration (2)||2.6||3.0||5.6|
|(1)||Does not include revenue associated with production sales during testing|
|(2)||Includes acquisition related costs of approximately $0.2 million.|
About Platino Energy
Platino is a Calgary, Alberta headquartered resource company engaged, through its subsidiaries, in the exploration for, and the acquisition, development and production of hydrocarbons in Colombia. For further information please refer to Platino’s website at www.platinoenergy.com
Advisory Regarding Forward-Looking Information
This news release contains “forward-looking information” within the meaning of applicable securities laws. The use of any of the words “will”, “plans”, “expects”, “estimates”, “anticipate” and similar expressions is intended to identify forward-looking information concerning the Company’s future operations and performance, including the exploration results and further exploration and testing plans for the Coati Block; the testing and drilling plans for the Coati-1 well and the timing thereof; the operatorship of the Coati Block; and the approval of the ANH.
The forward-looking information in this news release is based on certain key expectations and assumptions made by Platino, including assumptions as to: the timing and progress of work relating to Platino’s Coati-1 well and the Coati Block; the accuracy of testing results and seismic data; the geography of the areas in which Platino will conduct exploration and development activities; the receipt of ANH approval in respect of (i) the transaction with Parex, (ii) the transfer of operatorship of the Coati Block, and (iii) the extension of the timing for the current phase on the Putumayo-8 Block; the sufficiency of budgeted capital expenditures in carrying out planned activities and the Company’s estimated spending and cash flow for the remainder of 2013; and the general continuance of current or, where applicable, assumed operational, regulatory and industry conditions. Although Platino believes that the expectations and assumptions on which such forward-looking information is based are reasonable, undue reliance should not be placed on the forward-looking information because Platino can give no assurance that it will prove to be correct.
The forward-looking information in this news release is subject to known and unknown risks and uncertainties and other factors which may cause actual results to differ materially from those expressed or implied in the forward-looking information. Such risks, uncertainties and factors include, among others: the inability to secure necessary regulatory or other third party approvals; the nature of the exploration and development activities on Platino’s assets; and difficulties encountered during the exploration for, delineation, development and production of oil. As a result of the foregoing, readers should not place undue reliance on the forward-looking information contained in this news release. Readers are cautioned that the foregoing list of factors is not exhaustive. Additional information on these and other factors that could affect the operations or financial results of Platino are included in the Listing Application (Form 2B) of Platino filed with the TSX Venture Exchange, which has been filed with applicable securities regulatory authorities and may be accessed through the SEDAR website www.sedar.com.
The forward-looking information contained in this news release is made as of the date hereof and Platino undertakes no obligation to update publicly or revise any forward-looking information, whether as a result of new information, future events or otherwise, unless so required by applicable securities laws.
NEITHER THE TSX VENTURE EXCHANGE NOR ITS REGULATION SERVICES PROVIDER (AS THAT TERM IS DEFINED IN THE POLICIES OF THE TSX VENTURE EXCHANGE) ACCEPTS RESPONSIBILITY FOR THE ADEQUACY OR ACCURACY OF THIS RELEASE
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