Hydrocarbons Encountered in Four Zones; Testing Program Planned
CALGARY, Alberta, May 15, 2007, Gran Tierra Energy Inc. (OTCBB: GTRE.OB), a company focused on oil exploration and production in South America, today announced that it has successfully drilled, logged and cased a new field wildcat well in the Chaza Block, Putumayo Basin, in southern Colombia. Significant hydrocarbon shows were encountered and a testing program is currently being planned.
Gran Tierra Energy holds a 50% working interest and is Operator of this block. Partner, Solana Resources Limited, holds a 50% working interest. The Chaza Block is subject to the most recent Agencia Nacional de Hidrocarburos (ANH) contract terms, with attractive fiscal terms including a sliding scale royalty commencing at 8% and no back-in rights by the state company Ecopetrol.
Gran Tierra reported that its Costayaco-1 well reached a total measured depth of 8,570 feet on May 10, 2007. The well encountered reservoir quality sandstones with oil and gas shows in four zones. Initial log interpretations indicate potential oil pay in the Kg Sand Unit of the Rumiyaco Formation, the U Sandstone Unit of the Villeta Formation, the T Sandstone Unit of the Villeta Formation and in the Caballos Formation. These are the same four zones currently undergoing drill stem tests in Gran Tierra's recent Juanambu-1 oil discovery in the adjacent Guayuyaco Block, and are proven producing reservoirs in fields in the adjacent Santana and Guayuyaco Blocks operated by Gran Tierra Energy.
The Costayaco-1 well bore has been cased in preparation for testing. The service rig currently testing Juanambu-1 will move to the Costayaco-1 location to begin testing operations in June. Planning for a seismic acquisition infill program over the Costayaco structure has been initiated to optimize potential delineation and development drilling locations.
Dana Coffield, President and Chief Executive Officer of Gran Tierra, stated "These early positive results justify an extensive testing program to evaluate the commercial potential of the encountered hydrocarbons zones similar to those currently underway at our Juanambu-1 discovery. This has the potential to be our third oil discovery this year, following the nearby Juanambu oil well in March which is currently being tested, and the Puesto Climaco-2D oil well in Argentina in January which is currently on production."
About Gran Tierra Energy Inc.
Gran Tierra Energy Inc. is an international oil and gas exploration and production company, headquartered in Calgary, Canada, incorporated and traded in the United States and operating in South America. Gran Tierra holds interests in producing and prospective properties in Argentina, Colombia and Peru. To date, Gran Tierra has pursued a strategy that focuses on establishing a portfolio of producing properties, development and exploration opportunities, through selective acquisitions, to provide a base for future growth. Additional information concerning Gran Tierra is available at http://www.grantierra.com. Investor inquiries may be directed to [email protected] or 1-800-916-GTRE (4873).
Forward Looking Statements
The statement in this press release regarding the planning of testing of the Costayaco-1 exploration well is a forward-looking statement' within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934. Although this forward-looking statement reflects the good faith judgment of management, forward-looking statements are inherently subject to known and unknown risks and uncertainties that may cause actual results to be materially different from those discussed in these forward-looking statements including, but not limited to, in the case of this forward-looking statement, mechanical problems, equipment limitations and weather conditions, which could delay or prevent the completion of the testing. Readers are urged not to place undue reliance on this forward-looking statement, which speaks only as of the date of this release. Gran Tierra assumes no obligation to update this forward-looking statement in order to reflect any event or circumstance that may arise after the date of this release, other than as may be required by applicable law or regulation. Readers are urged to carefully review and consider the various disclosures made by Gran Tierra in its reports filed with the Securities and Exchange Commission, including those risks set forth in the Gran Tierra's Registration Statement filed on May 4, 2007, which attempt to advise interested parties of the risks and factors that may affect Gran Tierra's business. If one or more of these risks or uncertainties materialize, or if the underlying assumptions prove incorrect, Gran Tierra's actual results may vary materially from those expected or projected.