President Energy (PPC), the oil and gas exploration company provides the following update on its operation in Argentina
The Coiled Tubing program is progressing and operations have just commenced on the second of the expected now five well campaign. The intervention on the first well, Poso Escondido 3, a previously producing well shut-in since 1993, has provided valuable information on the Yacoraite reservoir at this location and has flowed a limited amount of oil to surface. Although the stimulation and extended testing could not be carried out due to a tubing leak, the operation demonstrated that the Yacoraite remains without significant depletion and is capable of flowing oil without artificial lift. The well will now be a candidate for a follow-up workover campaign that is being planned at the Concession. There are no reserves attributed to this well in the reserves statement referred to below.
The analysis and investigation as to the circumstances surrounding the drilling of DP1002 S/T continues and will be pursued vigorously by President. Meanwhile, a resumption of drilling remains suspended.
Management re-iterates that the mechanical failures on DP-1002ST were not related to geological factors of the target producing reservoir and that the horizontal landing of the well demonstrated that the well target was robust. The mechanical issues have no bearing on future drilling potential of the Puesto Guardian Concession with independently assessed reserve figures of 1P Proven and 2P Proven plus Probable Oil Reserves of 11 mmbbls and 18.1 mmbbls respectively.
Peter Levine, Chairman, commented:
Work continues in Argentina, the oil is in the ground and there is a determination to produce the same from our robust reserves.
