TIDMTXP
RNS Number : 4137H
Touchstone Exploration Inc.
03 December 2020
TOUCHSTONE ANNOUNCES CASCADURA DEEP-1 DRILLING RESULTS
CALGARY, ALBERTA (December 3, 2020) - Touchstone Exploration
Inc. ( " Touchstone ", "we", "our", "us" or the " Company " ) (TSX,
LSE: TXP) reports that the Company has completed drilling the
Cascadura Deep-1 exploration well on the Ortoire exploration block,
onshore in the Republic of Trinidad and Tobago (Touchstone 80%
working interest operator, Heritage Petroleum Company Limited 20%
working interest) and is pleased to announce that the well
encountered significant hydrocarbon accumulations based on drilling
and wireline log data.
Highlights
-- Cascadura Deep-1 was drilled to a total depth of 8,303 feet.
Drilling was suspended prior to the planned total depth of 10,600
feet due to high pressure gas zones encountered while drilling.
-- The well encountered total sand thickness of 2,100 feet in
multiple, stacked thrust sheets in the Herrera section.
-- Wireline logs indicated natural gas pay totaling
approximately 1,315 net feet in four unique thrust sheets in the
Herrera sands from a depth of 5,455 feet to total depth.
-- An aggregate 1,007 net feet of natural gas pay was identified
in the overthrust sheets, an increase of approximately 20 percent
compared to the Cascadura-1ST1 discovery.
-- Additional natural gas pay of approximately 308 net feet was
encountered in two previously untested Herrera thrust sheets below
the sands observed in the Cascadura-1ST1 well.
Paul R. Baay, President and Chief Executive Officer,
commented:
"I am pleased that the Ortoire block continues to outperform our
expectations. The Cascadura Deep-1 well is the best well we have
drilled on the Ortoire property to date and it has provided three
key pieces of information, primarily that the Cascadura field has
numerous targets with each one of the thrust sheets providing its
own unique opportunity. It has also shown that the system is
hydrocarbon charged and that in time we will require more drilling
horsepower to evaluate the deeper zones. We now have a unique
opportunity to design a development drilling program in the area
and expand our exploration program while we complete and tie-in the
existing Cascadura and Chinook wells. The time required to
undertake this will allow us to secure additional equipment and
submit a full field development plan to proceed with a continual
drilling program. As we move into 2021, Touchstone is entering a
new phase that will see rapid production growth along with a
balanced portfolio of development and exploration
opportunities."
The Cascadura Deep-1 well was drilled to a total measured depth
of 8,303 feet (true vertical depth of 8,133 feet) on November 30,
2020. While the well was originally planned to be drilled to a
total depth of 10,600 feet, the gas sands encountered in overthrust
Sheet 4 proved difficult to manage, and the decision was made to
cease drilling to preserve the substantial pay section encountered
in the well.
Drilling samples and open hole wireline logs indicated that the
well encountered a significant Herrera turbidite package with a
total thickness of over 2,900 feet containing in excess of 2,100
feet of sand, with an aggregate 1,315 net feet of natural gas pay
in four unique thrust sheets.
The well encountered 558 net feet of hydrocarbon pay in the
Gr7bc section of the overthrust Herrera sands at measured depths
between 5,450 and 6,050 feet. These sands, locally referred to as
the Sheet 3 overthrust sands, correlate to the sands discovered and
tested at Cascadura-1ST1 at depths between 5,516 and 6,162 feet.
The gross section encountered in Cascadura Deep-1 was 20 feet less
than observed in Cascadura-1ST1 which is located approximately 900
feet to the northwest.
The well encountered 449 net feet of hydrocarbon pay in the
Gr7abc section of Sheet 4 of the overthrust Herrera sands at
measured depths between 6,050 and 6,532 feet. These sands correlate
to the lower sands discovered and tested in Cascadura-1ST1 at
depths between 6,162 and 6,350 feet. The gross Sheet 4 section
encountered at Cascadura Deep-1 is more than 245 feet thicker than
sands observed in the Cascadura-1ST1 well and is consistent with
the Company's models based on seismic data.
The intermediate Gr7bc sands were the Company's primary target
originally identified in the offsetting BW-5 well. 308 net feet of
hydrocarbon pay was identified in two thrust sheets within the
Gr7bc section of the intermediate Herrera sands at measured depths
between 7,086 and 8,246 feet. The sands encountered in one of these
thrust sheets correlate to the offsetting BW-5 well while the other
thrust sheet was not encountered in the offsetting well; neither
thrust sheet has been previously tested.
James Shipka, Chief Operating Officer, stated:
"The Cascadura structure continues to exceed our expectations,
and the Cascadura Deep-1 exploration well confirms that this is a
unique structure with tremendous potential. Although we were unable
to drill to our planned total depth, the information gathered while
drilling and the hydrocarbon accumulations encountered are truly
exceptional. Not only did we encounter a massive section of
turbidite deposits nearly 3,000 feet thick, we established the
intermediate thrust sheet as a viable reservoir and expanded the
known boundaries of the sands tested in the Cascadura-1ST1 well. In
the intermediate section, wireline data identified in excess of 300
feet of prospective pay in two thrust sheets, one of which has not
been previously encountered in the area. While those 308 feet of
sand met the threshold for pay based on log data, wellsite sampling
saw hydrocarbon indicators throughout the entire section which we
aim to gain a better understanding of through our production
testing program. In the sands previously evaluated in
Cascadura-1ST1, we were able to not only confirm the continuity of
the structure, we were able to identify the base of the sand
package at nearly 200 feet below the total depth of the original
well. Finally, the information obtained at Cascadura Deep-1
provides great insight into what was observed at the Chinook-1 well
which the Company expects to commence production testing later this
month."
The Cascadura Deep-1 exploration well was spud on October 27,
2020 using Well Services Petroleum Ltd. Rig #80. The well was
designed to explore the potential of a thick sequence of Herrera
sandstones contained in a series of thrust sheets which were
observed in the offsetting BW-5 well as well as the recent
Cascadura-1ST1 and Chinook-1 discoveries . The primary target of
the Cascadura Deep-1 well were the Gr7bc Herrera sands in the
intermediate thrust sheet at an approximate measured depth of 7,600
feet. These sands were interpreted to correlate to, but separate
from, the sands observed in the Company's Chinook-1 discovery. The
well was intended to further evaluate a secondary target of a
repeated section of Gr7bc Herrera sands in a subthrust sheet from
approximately 9,500 feet to a planned total depth of 10,600
feet.
The Cascadura Deep-1 well is the fourth of the amended five well
exploration commitment under Touchstone's Ortoire Exploration and
Production Licence. The Company has an 80% working interest in the
licence but is responsible for 100% of the drilling, completion and
testing costs associated with the initial five exploration wells.
Heritage Petroleum Company Limited holds the remaining 20% working
interest. Touchstone had no reserves booked for the Cascadura
Deep-1 well in the Company's December 31, 2019 independent reserves
report. Further testing is required to determine the economic
viability and potential of the well, and the Company plans to
commence completion and production testing operations during the
first quarter of 2021.
Term Loan Amendment
On November 27, 2020, the Company and its lender executed an
amending agreement to the Loan Agreement, allowing the Company to
repay $7.5 million of the current $15 million term loan balance on
December 15, 2020 to reduce interest costs. Upon repayment, the
available credit capacity of $12.5 million may be drawn by the
Company at any time prior to June 15, 2021.
Touchstone Exploration Inc.
Touchstone Exploration Inc. is a Calgary, Alberta based company
engaged in the business of acquiring interests in petroleum and
natural gas rights and the exploration, development, production and
sale of petroleum and natural gas. Touchstone is currently active
in onshore properties located in the Republic of Trinidad and
Tobago. The Company's common shares are traded on the Toronto Stock
Exchange and the AIM market of the London Stock Exchange under the
symbol " TXP " .
For further information about Touchstone, please visit our
website at www.touchstoneexploration.com or contact:
Touchstone Exploration Inc.
Mr. Paul Baay, President and Chief Executive Officer Tel: +1
(403) 750-4487
Mr. James Shipka, Chief Operating Officer
Mr. Scott Budau, Chief Financial Officer
Shore Capital (Nominated Advisor and Joint Broker)
Nominated Advisor: Edward Mansfield / Daniel Bush / Michael McGloin Tel: +44 (0) 207 408 4090
Corporate Broking: Jerry Keen
Canaccord Genuity (Joint Broker)
Adam James / Henry Fitzgerald O'Connor / Thomas Diehl Tel: +44
(0) 207 523 8000
Camarco (Financial PR)
Nick Hennis / Billy Clegg Tel: +44 (0) 203 781 8330
Advisories
Forward-Looking Statements
Certain information provided in this announcement may constitute
forward-looking statements and information (collectively,
"forward-looking statements") within the meaning of applicable
securities laws. Such forward-looking statements include, without
limitation, forecasts, estimates, expectations and objectives for
future operations that are subject to assumptions, risks and
uncertainties, many of which are beyond the control of the Company.
Forward-looking statements are statements that are not historical
facts and are generally, but not always, identified by the words
"expects", "plans", "anticipates", "believes", "intends",
"estimates", "projects", "potential" and similar expressions, or
are events or conditions that "will", "would", "may", "could" or
"should" occur or be achieved.
Forward-looking statements in this announcement may include, but
is not limited to, statements relating to the quality and quantity
of prospective hydrocarbon accumulations based on wireline logs,
including the Company's interpretations thereof ; and the Company's
exploration plans and strategies, including anticipated drilling,
timing, production testing, development, tie-in, facilities
construction, and ultimate production from exploration and
development wells. Although the Company believes that the
expectations and assumptions on which the forward-looking
statements are based are reasonable, undue reliance should not be
placed on the forward-looking statements because the Company can
give no assurance that they will prove to be correct. Since
forward-looking statements address future events and conditions, by
their very nature they involve inherent risks and uncertainties.
Actual results could differ materially from those currently
anticipated due to a number of factors and risks. Certain of these
risks are set out in more detail in the Company's 2019 Annual
Information Form dated March 25, 2020 which has been filed on SEDAR
and can be accessed at www.sedar.com. The forward-looking
statements contained in this announcement are made as of the date
hereof, and except as may be required by applicable securities
laws, the Company assumes no obligation to update publicly or
revise any forward-looking statements made herein or otherwise,
whether as a result of new information, future events or
otherwise.
Competent Persons Statement
In accordance with the AIM Rules for Companies, the technical
information contained in this announcement has been reviewed and
approved by James Shipka, Chief Operating Officer of Touchstone
Exploration Inc. Mr. Shipka is a qualified person as defined in the
London Stock Exchange's Guidance Note for Mining and Oil and Gas
Companies and is a Fellow of the Geological Society of London (BGS)
as well as a member of the Canadian Society of Petroleum Geologists
and the Geological Society of Trinidad and Tobago. Mr. Shipka has a
Bachelor of Science in Geology from the University of Calgary and
has over 30 years of oil and gas exploration and development
experience.
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END
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