Touchstone Exploration Share News (TXP)

(Sharecast News) - Touchstone Exploration announced on Friday that its indirect wholly-owned subsidiary Primera Oil and Gas has executed a long-term natural gas sales agreement with the National Gas Company of Trinidad and Tobago (NGC) for all future natural gas production from the Ortoire block.
The AIM-traded firm said it has a 80% working interest and is the operator of the Ortoire block, with Heritage Petroleum Company having a 20% working interest.

Primera, acting on behalf of its joint venture partner Heritage, would supply gas from the Ortoire Block initially from the Coho-1 field.

"This agreement provides a stable, multi-decade revenue stream for Touchstone to fully develop the world-class asset at Ortoire," said Touchstone chief executive officer Paul Baay.

"This transforms the company from being an exploration company to one that is a full cycle energy provider.

"The structure of the agreement provides the shareholders of Touchstone with a predictable cash flow and earnings stream for years to come while minimising the capital required to maximise the resource."

On the operational front, Touchstone said it had mobilised a service rig to the Chinook-1 location to perform a "comprehensive" completion and production testing program.

The company said it expected to perform three production tests to evaluate reservoir pressures and hydrocarbon deliverability of the Herrera sands observed while drilling, and defined by open hole wireline logs.

It said the first test would evaluate the previously-untested subthrust Herrera sands, while the other tests were expected to investigate the potential of the intermediate and overthrust Herrera sand intervals.

"We anticipate final results from the Chinook-1 production testing program in the first quarter of 2021," the Touchstone board said in its statement.

Following testing at Chinook-1, the firm said the service rig was expected to immediately move to the Cascadura Deep-1 location.

The Cascadura Deep-1 production testing programme was expected to include flow and buildup testing of three zones of interest.

It said the first two tests plan to evaluate sands observed in two previously-untested thrust sheets in the intermediate Herrera that were below the sands observed in the Cascadura-1ST1 well, while the third test would assess the base of the sands which were observed, but not fully penetrated, in the Cascadura-1ST1 well.

At 1135 GMT, shares in Touchstone Exploration were up 3.79% at 129.22p.