Coiron Amargo Sur Este Field – Drilling of Vaca Muerta Shale Oil Resource Play
July 17 2017 - 7:30AM
Madalena Energy Inc. ("Madalena" or the "Company") (TSXV:MVN)
(OTCQX:MDLNF) is pleased to announce the initial results of the
completion and testing of the first horizontal multi-frac well in
the Vaca Muerta Shale Formation at the Coiron Amargo Sur Este
(“CASE”) block in Argentina.
Madalena’s partner, Pan American Energy LLC,
Sucursal Argentina ("PAE") is the operator at CASE with a 55%
working interest. Madalena and Gas y Petroleo del Neuquén, the
provincial oil and gas company in the Province of Neuquén, hold 35%
and 10% working interests, respectively.
Pursuant to certain transactions described in
previous news releases of the Company, the 2017 work program at
CASE is comprised of two well re-entries with a net benefit to
Madalena of up to $5.6 million in carried capital costs.
Highlights
- PAE successfully re-entered the CAS.x-15 well and drilled
horizontally for approximately 1,000 metres in the Vaca Muerta
unconventional oil resource play at a vertical depth of
approximately 3,200 metres;
- A liner with frac sleeves has been run and cemented. The well
was completed rig-less at the end of May with 37 hydraulic frac
stages with approximately 6,500 klb of proppant and 90,000 barrels
of total fluid;
- The well tested an average of 430 barrels of oil per day
through 3mm choke for the last four weeks;
- Recovered approximately 18% of fracture fluid during the first
week and no water production has been reported since that
time;
- The well CAS.x-15(ST) tested the Vaca Muerta shale structured
concept, offering new insights into the play extension within the
fracture trend;
- Total gross estimated cost of this re-entry is US$8.72 million,
which includes the costs for drilling, completing and equipping the
well.
Jose David Penafiel, CEO of Madalena Energy commented:
“The test results of CAS.x-15(ST) are extremely encouraging and
we are now looking forward to increased production revenue as a
result of this new well.
The well results of CAS.x-15(ST) are significant on a number of
grounds. It has significantly derisked Madalena’s Vaca Muerta
acreage in the CASE block, supporting the company’s internal
contingent resources estimates. To obtain these test results from
just 1000 meters and 37 frac stages is clearly satisfying, however
Madalena believes that with further improvements to the drilling
and completion techniques, considerably more can be realised from
the next wells that will be drilled on the CASE block. This result
highlights the prospectivity of our Vaca Muerta Acreage, we are
excited to further delineate and develop the CASE acreage with our
partner Panamerican Energy.”
About Madalena Energy
Madalena is an independent, Canadian
headquartered, Argentina focused upstream oil and gas company with
operations in four provinces of Argentina where it is focused on
the delineation of unconventional resources in the Vaca Muerta
shale, Lower Agrio shale and Loma Montosa oil plays. The Company is
implementing horizontal drilling and completions technology to
develop both its conventional and resource plays.
Madalena trades on the TSX Venture Exchange
under the symbol MVN and on the OTCQX under the symbol MDLNF.
Reader Advisories
Forward Looking Information
The information in this news release contains
certain forward-looking statements. These statements relate to
future events or our future performance, in particular, but not
limited to, with respect to matters related to planned operations
at CASE. All statements other than statements of historical
fact may be forward-looking statements. Forward-looking statements
are often, but not always, identified by the use of words such as
"seek", "anticipate", "plan", "continue", "estimate",
"approximate", "expect", "may", "will", "project", "predict",
"potential", "targeting", "intend", "could", "might", "should",
"believe", "would" and similar expressions. These statements
involve substantial known and unknown risks and uncertainties,
certain of which are beyond the Company's control, including: the
impact of general economic conditions; industry conditions; changes
in laws and regulations including the adoption of new environmental
laws and regulations and changes in how they are interpreted and
enforced; fluctuations in commodity prices and foreign exchange and
interest rates; stock market volatility and market valuations;
volatility in market prices for oil and natural gas; liabilities
inherent in oil and natural gas operations; uncertainties
associated with estimating oil and natural gas reserves;
competition for, among other things, capital, acquisitions, of
reserves, undeveloped lands and skilled personnel; incorrect
assessments of the value of acquisitions; changes in income tax
laws or changes in tax laws and incentive programs relating to the
oil and gas industry; geological, technical, drilling and
processing problems and other difficulties in producing petroleum
reserves; and obtaining required approvals of regulatory
authorities. There is specific risk that the CAS.x-15 well will not
continue to produce at initial rates disclosed in this press
release. The Company's actual results, performance or achievement
could differ materially from those expressed in, or implied by,
such forward-looking statements and, accordingly, no assurances can
be given that any of the events anticipated by the forward-looking
statements will transpire or occur or, if any of them do, what
benefits the Company will derive from them. These statements are
subject to certain risks and uncertainties and may be based on
assumptions that could cause actual results to differ materially
from those anticipated or implied in the forward-looking
statements. The forward-looking statements in this news release are
expressly qualified in their entirety by this cautionary statement.
Except as required by law, the Company undertakes no obligation to
publicly update or revise any forward-looking statements. Investors
are encouraged to review and consider the additional risk factors
set forth in the Company's Annual Information Form, which is
available on SEDAR at www.sedar.com.
Well Test Results
Well test results should be considered as
preliminary and not necessarily indicative of long-term performance
or of ultimate recovery. Neither a pressure transient analysis nor
a well-test interpretation has been carried out on the well test
data contained herein and therefore the data contained herein
should be considered to be preliminary until such analysis or
interpretation has been done.
Neither the TSX Venture Exchange nor its
Regulation Service Provider (as that term is defined in the
policies of the TSX Venture Exchange) accepts responsibility for
the adequacy or accuracy of this release.
For further information please contact:
Jose Penafiel
Chief Executive Officer
jpenafiel@madalenaenergy.com
Alejandro A. Penafiel
Director
apenafiel@madalenaenergy.com
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