Peru, Colombia and Cuba operating oil and gas explorer and producer Gold Oil (LSE: GOO) reported on the preliminary results of the 50 sq km (square kilometre) 3D survey acquired on the southern part of the Azar block in Colombia, calling them “excellent” and looking to drill the prospect as quickly as possible.
La Vega East is estimated to have 3.25MMbbl (million barrels) in the T and U sands with Gold’s share amounting to 0.6MMbbl. The La Vega South prospect is estimated to have resources of 3.24MMbbl in both sands with Gold holding an identical share of 0.6MMbbl.
The operator, Gran Tierra Energy Company (GTEC), which conducted the estimates, previously operated several blocks in the Putumayo Basin, of which these prospects are very typical, the company said in the statement.
The drilling of the La Vega South and East prospects will be drilled in Q2/Q3 2010 as soon as the relevant environment impact assessment permits are granted.
“I am pleased with the excellent news on the Azar Block and happy to have reached consensus with our partners to develop the Block as quickly as possible, bearing in mind that the environmental permitting for the two projected wells is likely to take at least 6 month for approval, once presented to the Ministry,” said Chairman of Gold Oil Mark Pritchard.
The two companies have also decided to acquire an additional 75 sq km of 3D seismic over the La Florida structure in the northern part of the block, where 51 km of 2D seismic has already been acquired. According to GTEC estimates, this prospect has the potential for 15-25MMbbl of oil initially in place. The survey is expected to provide a better estimate in March/April next year.
Gold Oil also said that local consultation, detailed topography and drilling of the shot-holes for the dynamite charges in the southern portion of its Rosa Blanca block in the Middle Magdalena Basin was at an advanced stage. Preliminary interpretation of the seismic data is slated for the first week of December.
Testing of the Burdine wells is ongoing with the B-1 well producing an average of 230 bopd (barrels of oil per day) of light crude. The goal of the long-term test is to get more information on the well to optimize the work-over programme for B-1 and B-5, which has produced 60 bopd on a short test. The company expects the work-over programme for the Burdine well to increase production of the field to 1,500 bopd with Gold’s share amounting to 410 bopd.
Shares in the company surged 17% in reaction to the news, and settled at a more than 8 percent rise by midday.