How it is doing
On 20 January, Echo Energy PLC (LON:ECHO) told investors that drilling and wireline logging is now complete for the Campo Limite exploration well (CLix-1001), and, amid encouraging results the explorer and its partners will now move the well into testing.
The company, in a statement, revealed the CLix-1001 encountered the targeted Springhill formation, at a depth of 2,124 metres, and, wireline logging has highlighted a zone of interest which coincides with elevated gas shows.
“The presence of elevated gas shows in the target section combined with wireline log data is positive and has resulted in the company and the operator taking the decision to move to completion and testing,” Echo said.
“The company cautions that completion of the well test and analyses of the results is needed to conclusively establish the presence of producible gas.”
Echo said that testing will be enabled by the well’s completion by the Petreven H-205 rig for which mobilisation is currently being scheduled.
Earlier in January, Echo carried out perforation and started stimulation operations for the Campo La Mata x-1 well.
On 6 January it said that would move on to stimulate deeper secondary targets shortly thereafter.
At that time, also, house broker ShoreCap told clients: “continue to believe that the next few weeks will be extremely exciting for Echo, with the company pressing ahead with operations on its recently drilled ‘CLM x-1’ well at Tapi Aike (following very encouraging initial results) and with ‘Campo Limite’ now successfully spudded.”
They added: “Ahead of further news, our last published Risked NAV estimate for Echo stands at 5p/share, implying very significant upside from the prevailing share price.”
In 2019, Echo completed a seismic acquisition campaign and conducted extensive preparations for an upcoming drill programme.
Processed data from the 414 square kilometre eastern cube highlighted an amplitude feature similar to one identified during the interpretation of the 2D seismic. Analysis focused on the geological understanding of this feature and where to drill.
More processing took place for the larger, 790 square km West Cube of Tapi Aike.
Santa Cruz Sur asset package
Echo in 2019 agreed to acquire the Santa Cruz Sur asset package, giving the company non-operated 70% interests in five blocks which host production adjacent to Tapi Aike.
The assets have two decades of production history, had 13.7mln barrels of 2P reserves at the end of 2018, and last year generated around US$31.9mln of revenue and US$8.2mln of earnings (EBITDA).
Joint evaluation in Bolivia
Away from Argentina, Echo has an involvement in the neighbouring Latin American country of Bolivia, where it is currently partnered in a joint evaluation agreement with Pluspetrol for the Huayco block in the prolific Tarija basin.
Tarija is believed to be home to 85% of Bolivia’s gas reserves.
Echo is also waiting for a permit on the onshore Rio Salado Block.
In September, the exploration company reported a US$7.87mln loss for the six months to June, including a US$2.79mln impairment of intangible assets and US$1.94mln of admin expenses.
Echo ended June with some US$4.12mln of cash and equivalents.
More Tapi Aike test results
Palermo Aike well results
Movement on acreage in Bolivia
Economic situation stabilises in Argentina