The Globe and Mail

Go to the Globe and Mail homepage

Jump to main navigationJump to main content

Press release from CNW Group

Pacific Rubiales confirms oil discovery on the Karoon blocks, offshore Brazil

Thursday, January 24, 2013

Pacific Rubiales confirms oil discovery on the Karoon blocks, offshore Brazil17:57 EST Thursday, January 24, 2013TORONTO, Jan. 24, 2013 /CNW/ - Pacific Rubiales Energy Corp. (TSX: PRE; BVC: PREC; BOVESPA: PREB) confirmed today the discovery of light oil at the Kangaroo-1 exploration well drilling on block S-M-1101, in the Santos basin, offshore Brazil.  The well was drilled as part of an agreement announced by the Company on September 18, 2012, as a minimum work commitment for both the S-M-1101 and S-M-1165 blocks, where the Company holds a 35% participating interest (subject to approval by Brazil's Agência Nacional do Petróleo, Gás Natural e Biocombustíveis (ANP)).As announced by the operator of the blocks, Karoon Gas Australia Ltd. (ASX: KAR), (see Karoon website: www.karoongas.com.au), the Kangaroo-1 well has been drilled to a depth of 3,049 meters and the presence of a light oil column has been confirmed by mudlog, wireline petrophysical and MDT pressure data in Eocene aged rocks.  A gross column of 25 meters and an oil / water contact is established from pressure data interpretation.The well intersected the Eocene reservoir section 300 metres down dip from the trap crest as interpreted on seismic mapping by Karoon.  A potential gross hydrocarbon column of approximately 350 metres is estimated by Karoon for the entire trip.As this was not the primary target at the Kangaroo-1 well, the discovery of oil in the Eocene reservoir at the Kangaroo-1 well provides additional information with respect to other potential prospects within the Karoon blocks.  Also, the well exhibited good oil shows at the base of the Miocene aged carbonate layers, but these are still under a detail evaluation to determine their potential.A wireline program is currently underway with full results expected in the coming days.  A drill stem test program will be assessed on completion of the wireline evaluation.  The full evaluation program for the well is expected to continue through February.  Pacific Rubiales expects to issue an additional news release providing further technical details relating to these drill results.Pacific Rubiales, a Canadian company and producer of natural gas and crude oil, owns 100% of Meta Petroleum Corp., which operates the Rubiales, Piriri and Quifa heavy oil fields in the Llanos Basin, and 100% of Pacific Stratus Energy Colombia Corp., which operates the La Creciente natural gas field in the northwestern area of Colombia. Pacific Rubiales has also acquired 100% of PetroMagdalena Energy Corp., which owns light oil assets in Colombia, and 100% of C&C Energia Ltd., which owns light oil assets in the Llanos Basin. In addition, the Company has a diversified portfolio of assets beyond Colombia, which includes producing and exploration assets in Peru, Guatemala, Brazil, Guyana and Papua New Guinea.The Company's common shares trade on the Toronto Stock Exchange and La Bolsa de Valores de Colombia and as Brazilian Depositary Receipts on Brazil's Bolsa de Valores Mercadorias e Futuros under the ticker symbols PRE, PREC, and PREB, respectively.AdvisoriesCautionary Note Concerning Forward-Looking StatementsThis news release contains forward-looking statements. All statements, other than statements of historical fact, that address activities, events or developments that the Company believes, expects or anticipates will or may occur in the future (including, without limitation, statements regarding estimates and/or assumptions in respect of production, revenue, cash flow and costs, reserve and resource estimates, potential resources and reserves and the Company's exploration and development plans and objectives) are forward-looking statements. These forward-looking statements reflect the current expectations or beliefs of the Company based on information currently available to the Company. Forward-looking statements are subject to a number of risks and uncertainties that may cause the actual results of the Company to differ materially from those discussed in the forward-looking statements, and even if such actual results are realized or substantially realized, there can be no assurance that they will have the expected consequences to, or effects on, the Company. Factors that could cause actual results or events to differ materially from current expectations include, among other things: uncertainty of estimates of capital and operating costs, production estimates and estimated economic return; the possibility that actual circumstances will differ from the estimates and assumptions; failure to establish estimated resources or reserves; fluctuations in petroleum prices and currency exchange rates; inflation; changes in equity markets; political developments in Colombia, Guatemala or Peru; changes to regulations affecting the Company's activities; uncertainties relating to the availability and costs of financing needed in the future; the uncertainties involved in interpreting drilling results and other geological data; and the other risks disclosed under the heading "Risk Factors" and elsewhere in the Company's annual information form dated March 14, 2012 filed on SEDAR at www.sedar.com. Any forward-looking statement 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 statement, whether as a result of new information, future events or results or otherwise. Although the Company believes that the assumptions inherent in the forward-looking statements are reasonable, forward-looking statements are not guarantees of future performance and accordingly undue reliance should not be put on such statements due to the inherent uncertainty therein.In addition, reported production levels may not be reflective of sustainable production rates and future production rates may differ materially from the production rates reflected in this news release due to, among other factors, difficulties or interruptions encountered during the production of hydrocarbons.TranslationThis news release was prepared in the English language and subsequently translated into Spanish and Portuguese. In the case of any differences between the English version and its translated counterparts, the English document should be treated as the governing version.SOURCE: Pacific Rubiales Energy Corp.For further information: Christopher (Chris) LeGallais Sr. Vice President, Investor Relations +1 (647) 295-3700 Roberto Puente Sr. Manager, Investor Relations +57 (1) 511-2298 Javier Rodriguez Manager, Investor Relations +57 (1) 511-2319