Initial Results Indicate 99 feet of Gross Oil Column in Bretaña Norte Exploration Well in Peru; Moqueta-8 Tests 1,600 BOPD in Colombia
CALGARY, Alberta, February 11, 2013, Gran Tierra Energy Inc. (“Gran Tierra Energy”) (NYSE MKT: GTE, TSX: GTE), a company focused on oil exploration and production in South America, today provided updates for its exploration drilling in Peru and appraisal drilling in Colombia.
“Initial drilling results from the Bretaña Norte 95-2-1XD exploration well in Peru indicate oil-saturated reservoir with a gross oil column of 99 feet that was encountered approximately 48 feet higher than oil discovered at Bretaña-1 approximately four kilometers away. Three cores encompassing 90 percent of the oil-bearing reservoir section were successfully acquired. Oil samples have also been acquired and are being analyzed which, with a testing program that is currently being designed to test reservoir productivity, will assist in determining the commerciality of the discovery. As previously announced, this prospect contains substantial contingent resource potential, so these initial results are extremely exciting,” said Dana Coffield, President and Chief Executive Officer of Gran Tierra Energy. “In addition, we have successfully tested the Moqueta-8 appraisal well in Colombia and are now drilling the Moqueta-9 appraisal well, as we continue to evaluate the full potential of this growing oil discovery,” concluded Coffield.
Block 95 (100% working interest and operator)
Gran Tierra Energy has drilled, and initial well-log results have been obtained, from the Bretaña Norte 95-2-1XD exploration well. Oil shows were encountered at the top of the target Vivian reservoir section and coring operations were then initiated, resulting in the recovery of oil-saturated core over most of the oil-column and additional core in the underlying water column. Log interpretations and MDT fluid and pressure sampling indicate the presence of an oil-bearing sandstone reservoir in the Vivian Sandstone beginning at 9,408 feet measured depth (“MD”) or 8,851 feet true vertical depth (“TVD”) with an approximate gross oil column thickness of 99 feet and 53 feet net pay thickness.
Gran Tierra Energy is designing a testing program for the Bretaña Norte well to evaluate reservoir productivity with results expected in late February.
In its press release dated June 11, 2012, Gran Tierra Energy announced the results of a contingent gross lease resource estimate for the oil discovery on Block 95, provided by its independent reserves auditor, GLJ Petroleum Consultants effective June 1, 2012. The resource estimate has been prepared in compliance with National Instrument 51-101 – Standards of Disclosure for Oil and Gas Activities and the Canadian Oil and Gas Evaluation Handbook. The estimates included a low estimate “1C” contingent resources of 11.5 million stock tank barrels of oil (“MMSTB”), a best estimate “2C” contingent resources of 31.6 MMSTB, and a high estimate “3C” contingent resources of 88.1 MMSTB. Additional information respecting such contingent resource estimates is included in the June 11, 2012, press release and in the advisory attached.
The Supreme Decree approving the assignment of the additional 40% working interest in Block 95 to Gran Tierra Energy Peru S.R.L. was issued by the Government of Peru on January 23, 2013. It is expected that the Public Deed to finalize the assignment and vest a 100% working interest in the company will be executed in the near future.
Chaza Block, Putumayo Basin (Gran Tierra Energy 100% working interest and operator)
Gran Tierra Energy completed initial testing of Moqueta-8 by collecting reservoir data and fluid samples using a hydraulic jet pump from the Caballos formation, along with the T Sandstone and U Sandstone from the Villeta formations. The Caballos formation consisted of 209 feet TVD gross reservoir or 104 feet TVD net reservoir thickness. It was perforated and tested from 5,361 feet to 5,538 feet MD for 57 hours at a rate of 651 barrels of oil per day (“BOPD”) of 28.2° API oil with a 0.4% water cut. The T Sandstone formation consisted of 85 feet TVD gross reservoir or 72 feet TVD of net reservoir thickness. It was perforated and tested from 5,153 feet to 5,256 feet MD for 16.4 hours at a rate of 925 BOPD of 27.0° API oil and a stabilized 0.4% water cut. The U Sandstone formation consisted of 44 feet TVD gross reservoir or 32 feet TVD net reservoir thickness. It was perforated and tested from 4,866 feet to 4,911 feet MD for 24 hours at a rate of 24 BOPD of 16.3° API oil with a 0.4% water cut. This well is being completed as a production well.
Moqueta-9, the next well in the appraisal program to further define the reserve potential of the field, was spud on January 20, 2013 and is targeting the northern portion of the Moqueta field. Initial results are expected in late February.
About Gran Tierra Energy Inc.
Gran Tierra Energy is an international oil and gas exploration and production company, headquartered in Calgary, Canada, incorporated in the United States, trading on the NYSE MKT (GTE) and the Toronto Stock Exchange (GTE), and operating in South America. Gran Tierra Energy holds interests in producing and prospective properties in Colombia, Argentina, Peru, and Brazil. Gran Tierra Energy has a strategy that focuses on establishing a portfolio of producing properties, plus production enhancement and exploration opportunities to provide a base for future growth.
Gran Tierra Energy’s Securities and Exchange Commission filings are available on a web site maintained by the Securities and Exchange Commission at http://www.sec.gov and on SEDAR at http://www.sedar.com.
Forward Looking Statements and Advisories
Readers are cautioned that the well-flow test results disclosed in this press release are not necessarily indicative of long term performance or of ultimate recovery.
Contingent resources are those quantities of petroleum estimated, as of a given date, to be potentially recoverable from known accumulations using established technology or technology under development, but which are not currently considered to be commercially recoverable due to one or more contingencies. Contingencies may include factors such as economic, legal, environmental, political, and regulatory matters, or a lack of markets. It is also appropriate to classify as contingent resources the estimated discovered recoverable quantities associated with a project in the early evaluation stage. Contingent resources are further classified in accordance with the level of certainty associated with the estimates and may be subclassified based on project maturity and/or characterized by their economic status. There is no certainty that it will be commercially viable to produce any portion of these resources.
This news release contains certain forward-looking information and forward-looking statements (collectively, “forward-looking statements”) under the meaning of applicable securities laws, including Canadian Securities Administrators’ National Instrument 51-102 - Continuous Disclosure Obligations and the United States Private Securities Litigation Reform Act of 1995. The use of the words “will”, “expected”, “estimate” and “potential” and derivations thereof and similar terms identify forward-looking statements. In particular, but without limiting the foregoing, this news release contains forward-looking statements regarding the anticipated exploration and development activities, expected drilling locations, expected benefits from testing, and expected timing of activities and results. Statements relating to “resources” are forward-looking statements as they involve the implied assessment, based on estimates and assumptions, that the resources described exist in the quantities predicted or estimated and can be profitably produced in the future. Gran Tierra Energy believes the material factors, expectations and assumptions reflected in the forward-looking statements are reasonable at this time but no assurance can be given that these factors, expectations and assumptions will prove to be correct.
The forward-looking statements contained in this news release reflect several material factors and expectations and assumptions of Gran Tierra Energy including, without limitation: assumptions relating to log evaluations; that Gran Tierra Energy will continue to conduct its operations in a manner consistent with past operations; the accuracy of resource estimates; the accuracy of testing and production results and seismic data; the effects of certain drilling techniques; cost and price estimates; and the general continuance of current or, where applicable, assumed operational, regulatory and industry conditions. Gran Tierra Energy believes the material factors, expectations and assumptions reflected in the forward-looking statements are reasonable at this time but no assurance can be given that these factors, expectations and assumptions will prove to be correct.
The forward-looking statements contained in this news release are subject to risks, uncertainties and other factors that could cause actual results or outcomes to differ materially from those contemplated by the forward-looking statements, including, among others: unexpected technical difficulties and operational difficulties may occur, which could impact or delay the completion or continuation of drilling; geographic, political and weather conditions can interrupt drilling, which could impact or delay the commencement or continuation of drilling; and the risk that current global economic and credit market conditions may impact oil prices and oil consumption more than Gran Tierra Energy currently predicts, which could cause Gran Tierra Energy to change its current drilling, production and testing plans. Further information on potential factors that could affect Gran Tierra Energy are included in risks detailed from time to time in Gran Tierra Energy’s Securities and Exchange Commission filings, including, without limitation, under the caption “Risk Factors” in Gran Tierra Energy’s Quarterly Report on Form 10-Q filed November 7, 2012. These filings are available on a Web site maintained by the Securities and Exchange Commission at http://www.sec.gov and on SEDAR at www.sedar.com. The forward-looking statements contained herein are expressly qualified in their entirety by this cautionary statement. The forward-looking statements included in this press release are made as of the date of this press release and Gran Tierra Energy disclaims any intention or obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise, except as expressly required by applicable securities legislation.
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