Development Drilling and Additional Exploration Drilling Planning Continuing
CALGARY, Alberta – January 6, 2010, – Gran Tierra Energy Inc. (NYSE Amex: GTE; TSX: GTE), a company focused on oil exploration and production in South America, today announced that the company was unable to establish hydrocarbon flow from the Dantayaco-1 exploration well in Colombia. The Company also provided an update on the completion of Costayaco-10, the drilling of Juanambu-2 in Colombia, and preparations for initiating natural gas sales from VM.x-1001 in Argentina.
Drilling was completed on the Dantayaco-1 exploration well in the Chaza Block in the Putumayo basin. Oil shows encountered during drilling and log analysis indicated potential pay in the M1 Limestone and upper Caballos Formation, however, only formation water was recovered during testing. Testing operations have been suspended and the well was plugged and abandoned on January 3, 2010.
Seven exploration wells have been budgeted for the Putumayo Basin in southern Colombia for 2010. The next exploration well to be drilled will be Moqueta-1 in the Chaza Block to the north of the Costayaco Field. Drilling is expected to be initiated in early April 2010.
Testing of the T Sandstone and the underlying Caballos Formation has been completed in the recently drilled Costayaco-10 development well in the Costayaco field in the Chaza Block. Both the T Sandstone and Caballos Formation tested oil as expected. A completion string is currently being installed. The well is expected to be put into production at approximately 1,200barrels of oil per day from the Caballos reservoir in order to support Costayaco field plateau gross production of 19,000 barrels of oil per day.
The drilling of Juanambu-2, the second development well in the Juanambu oil field, began on December 27, 2009. Drilling is expected to take approximately 30 days. Upon completion, this well is expected to be tied into existing infrastructure. The Juanambu oil field was discovered by Gran Tierra Energy in 2007.
Permitting applications, facility inspections and testing of systems are nearly complete for the production infrastructure associated with the VM.x-1001 well in the Valle Morado block in the Noroeste Basin of northern Argentina. Sales from VM.x-1001 are targeted to commence late January 2010 at a rate of five to six million standard cubic feet per day, priced at US$2.90 per MMbtu. Volumes will be transported and processed through existing facilities. Workover and sidetrack operations on the well are scheduled for July 2010, at which time pricing may be renegotiated once new production volumes are established
About Gran Tierra Energy Inc.
Gran Tierra Energy Inc. is an international oil and gas exploration and production company, headquartered in Calgary, Canada, incorporated in the United States, trading on the NYSE Amex Exchange (GTE) and the Toronto Stock Exchange (GTE), and operating in South America. Gran Tierra Energy holds interests in producing and prospective properties in Argentina, Colombia and Peru, and has opened a business development office in Rio de Janeiro, 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.
Additional information concerning Gran Tierra Energy is available at www.grantierra.com, on SEDAR (www.sedar.com) and with the Securities and Exchange Commission (www.sec.gov).
The statements in this press release regarding Gran Tierra Energy’s expectations, plans, projections and actions including Gran Tierra Energy’s expectations regarding the drilling of Moqueta-1 and Juanambu-2, the expected production of Costayaco-10, and the expectations regarding gas sales from VM.x-1001 are "forward-looking statements" within the meaning of the U.S. federal and Canadian securities laws, including Canadian Securities Administrators’ National Instrument 51-102 Continuous Disclosure Obligations and the U.S. Private Securities Litigation Reform Act of 1995. Statements containing the words “estimates”, “expects”, “will”, “scheduled”, “may”, and variations of these words are forward-looking statements. These forward-looking statements 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. Although Gran Tierra Energy believes that the assumptions underlying, and expectations reflected in, these forward-looking statements are reasonable, it can give no assurance that these assumptions and expectations will prove to be correct.
Factors that could cause results to differ materially from those described in the forward-looking statements include: Gran Tierra Energy’s operations are located in South America, and unexpected problems can arise due to guerilla activity, technical difficulties and operational difficulties which impact the production, transportation or sale of oil and gas; changing prices for crude oil may cause some scheduled projects or actions to become uneconomical, or may change Gran Tierra Energy’s focus to other projects or actions which could be of more benefit to Gran Tierra Energy, which could cause projects or actions currently contemplated to be postponed or cancelled; unexpected problems due to technical difficulties, operational difficulties, and weather conditions; and those other risks found in the periodic reports filed by Gran Tierra Energy with the United States Securities and Exchange Commission, including in the section entitled “Risk Factors” in its Quarterly Report on Form 10-Q filed with the Securities and Exchange Commission on November 5, 2009, and available at the Securities and Exchange Commission's internet site www.sec.gov and on SEDAR at www.sedar.com.
All forward-looking statements in this press release are expressly qualified by information contained in Gran Tierra Energy’s filings with regulatory authorities and, subject to its obligations under applicable securities laws, Gran Tierra Energy does not undertake to publicly update forward-looking statements, whether as a result of new information, future events or otherwise.
For media and investor inquiries please contact David Feick, Equicom Group, 866-973-4873, 403-218-2862, [email protected]