President announces a further update in relation to its Argentine operations.
The four well workover program has been completed at a cost of below US$400,000, funded out of Argentine operating cash flow. This amount is less than a third of the cost of the two well workover programme in December 2015 due to rig-less working with a pumping unit.
The program addressing existing producing wells has been successful, with production increased by over 150 bopd. Total current production from the Puesto Guardian Concession is 500 bopd.
As part of field operations a rolling programme of producing well workovers will now be instigated to mitigate the inevitably normal field declines. The costs of these will be paid out of cash flow. As this work is considered part of regular maintenance, results will henceforth be reported in the form of updates on overall production and not on a workover by workover basis.
The results of this latest programme are very encouraging for the upcoming new drilling programme, with particular regard to completion and stimulation methodology where it is projected that for the first time in the history of Puesto Guardian drilling of horizontal production sections will form part of the operations.
Peter Levine, Chairman commented:
“Each time we intervene in wells we learn more and more. The cost effective results from the latest programme have provided valuable and encouraging data for us to take into account in the design and completion of wells in the forthcoming drilling programme.
Whilst there is much work still to do, we are optimistic about our Argentine prospects for the remainder of 2016. Oil sales prices are at US$58 per barrel, the macro and micro environment in Argentina is significantly more stable than last year, and average field production with the concomitant increase in free cash flow is on the rise.”
Miles Biggins, Bsc Joint Honours University College London, with 25 years of experience in the oil and gas sector, is a Petroleum Engineer and member of the Society of Petroleum Engineers who meets the criteria of qualified persons under the AIM guidance note for mining and oil and gas companies, has reviewed and approved the technical information contained in this announcement.
