16 Jun 2014 07:00
16 June 2014
PRESIDENT ENERGY PLC
("President" or "the Company")
Results of Audit of New Significant Prospective Resources
President announces the results of an independent audit of its Prospective Resources over the Lapacho prospect, Chaco region, Paraguay, carried out by the international consultancy RPS. Lapacho is a prospect in an independent petroleum system, newly identified by President, and is now anticipated to be a drilling location within the current three exploration well programme.
Highlights
· Lapacho prospect estimated to have gross mean unrisked Prospective Resources of 5.2 Tcf gas and 157 million barrels of condensate, in total over 1 billion boe (net to President 3.3 Tcf and 99 MMbbls condensate*)
· The Lower Devonian/Silurian Santa Rosa (in which the Lapacho prospect is found) has potential to be a significant gas-condensate system
· This is the third independent petroleum system which has been identified by President in the Chaco
· To date, an additional 11 structural prospects and leads in this system identified across both of President's Concessions (Pirity and Demattei)
Overview
President has now completed the interpretation and special processing of all new seismic data acquired during 2013 as well as re-reprocessing and re-interpretation of all historical data in the Pirity Basin, including over 1000km of old 2D seismic data . President's assessment of the overall level of exploration potential in the Pirity Basin has increased since the time of the Company's 2012 Farm-in.
As a consequence of the completion of this basin-wide evaluation it has become clear that there are three independent petroleum systems, each one of which is potentially capable of yielding giant field discoveries (i.e. over 100 MMboe).
The largest single prospect in the Basin is now seen to be Lapacho which is described in the independent audit of Prospective Resources carried out by the independent consultancy RPS and published today on President's website. Lapacho is estimated to have gross mean unrisked Prospective Resources of 5.2 Tcf gas plus 157 MMbbls condensate, in total over 1 billion boe (net to President 3.3 Tcf and 99 MMbbls condensate*).
* assumes full earn of 60% into Demattei concession; President has 64% interest in Pirity
Cretaceous
The initial petroleum system identified at the time of the farm-in during 2012 was the Cretaceous Yacoraite, which is a direct extension of the productive Palmar Largo oil field trend in Argentina. This play provides a high chance of success to discover multiple new light oil fields in Paraguay as described in the independent audit of Prospective Resources carried out by RPS as published in January 2014. The Cretaceous play will be tested by the Jacaranda x-1 well and the Tapir x-1 well both part of the present three well exploration programme, with estimated Cretaceous gross mean unrisked Prospective Resources respectively in excess of 376 MMboe and 106 MMboe (respectively net to President 240 MMboe and 68 MMboe).
Carboniferous/Upper Devonian
The second petroleum system identified is the Carboniferous/Upper Devonian Los Monos which extends into Paraguay from the adjacent productive areas of Bolivia and NW Argentina and becomes structured in very large fault blocks along the northern flank of the Pirity Rift. The Los Monos play was described in the independent audit of Prospective Resources carried out by RPS as published in January 2014. The Carboniferous/Upper Devonian will be tested by the Jacaranda x-1 well being drilled in the present exploration programme, with estimated gross mean unrisked Prospective Resources in the Jacaranda x-1 of 248 MMboe (158 MMboe net to President).
Lower Devonian/Silurian
The third independent petroleum system is the deeper Lower Devonian/Silurian Santa Rosa, which has now been identified basin-wide and is the subject of the independent audit of Prospective Resources within the Lapacho prospect carried out by RPS (published today). To date some 11 large structural prospects and leads have been identified in the Santa Rosa play in the Pirity and Demattei Concessions which offer giant gas-condensate potential at this deeper stratigraphic level. Combined with the 25 prospects and leads previously identified in the shallower plays, President now sees a total of 36 potentially drillable features in the Pirity Basin. The largest single prospect is the Santa Rosa feature known as Lapacho, with estimated gross mean unrisked Prospective Resources of 5.2 Tcf gas and 157 MMbbls condensate, in total over 1 billion boe, (net to President 3.3 Tcf and 99 MMbbls condensate*), which is a very large geological feature developed as a sub-crop over the crest of a regional structural high and very well located to trap regional hydrocarbon migration. As a consequence, President now anticipates the inclusion of the Lapacho x-1 well on the Pirity Concession within the three well exploration programme. The Tapir x-1 well may also potentially be deepened to test the Santa Rosa at that location. The follow on potential in the Santa Rosa play is very significant and although still a Frontier Play, a success at Lapacho would open the door for Paraguay to develop as a very significant gas-condensate producer in the Region in addition to the oil potential previously identified.
Drilling Programme
The three wells comprising the 2014 drilling programme will be drilled back to back, although the sequencing of wells two and three has yet to be fully determined. In light of the significance of the Lapacho prospect, the Yacare well will now fall outside the current drilling programme. Each of the three wells in the programme will be targeting independent prospects, each of very significant potential size and follow on scale.
Peter Levine, Executive Chairman, commented:
"The newly identified petroleum system and the size of the Lapacho prospect underline the potential significance of President's interests in Paraguay. It is now all about the present drilling programme which has commenced".
Dr. Richard Hubbard, PhD Geology Stanford University, with over 35 years of experience in the oil and gas sector, as President Chief Operating Officer, who meets the criteria of qualified persons under the AIM guidance note for mining and oil and gas companies, has reviewed and approved the technical information contained in this announcement.
Contact:
President Energy PLC
Peter Levine, Chairman +44 (0) 207 016 7950
John Hamilton, CEO +44 (0) 207 016 7950
Ben Wilkinson, Finance Director +44 (0) 207 016 7950
RBC Capital Markets
Jeremy Low, Matthew Coakes, Daniel Conti +44 (0) 207 653 4000
Canaccord Genuity Limited
Tim Redfern, Henry Fitzgerald-O'Connor +44 (0) 207 523 8000
Bell Pottinger
Gavin Davis, Henry Lerwill +44 (0) 207 861 3232