Pacific Rubiales Awarded Six Blocks in the "Ronda Colombia 2008" Bidding Process.
TORONTO, Nov. 10 /CNW/ - Pacific Rubiales Energy Corp. (TSX: PRE)
announced today that it has been awarded six new Blocks in Colombia through
its Colombian subsidiaries, Meta Petroleum Ltd. and Pacific Stratus Energy
Colombia Ltd. The Agencia Nacional de Hidrocarburos of Colombia (ANH), which
organized this bidding, offered 43 blocks located in five geological basins:
Llanos Orientales (17), Sinu San Jacinto (10), Cesar Rancheria (6), Cordillera
Oriental (6) and Guajira (4), with 39 companies participating. The company won
rights to two blocks by itself and rights to four blocks in consortium with
other companies, but in all of the six blocks that were awarded, the company's
subsidiaries will be the operator.
The blocks awarded to the company are:
CPO1: Pacific Rubiales has a 100% working interest and the block carries
an additional royalty of 6%. The block has an area of 61,776 hectares and is
located 80 kilometres north of the Rubiales field operated by the company. The
36 month-long first exploration phase requires a minimum investment of US$9.6
million, which will be spent on the acquisition of 200 km of 2D seismic and
the drilling of one exploratory well.
CPO12: This block was awarded to a consortium formed by Meta Petroleum
(40%), CEPSA Colombia Ltd. (30%) and Talisman Colombia Oil and Gas (30%); the
block carries an additional royalty of 28%. The block has an area of 286,827
hectares located to the southwest of the Rubiales field. During the first
exploration phase, the consortium will invest in the acquisition of 850 km of
seismic and the drilling of three exploratory wells, for a total amount of
CPO14: This block was awarded to a consortium formed by Meta Petroleum
(62.5%) and CEPSA Colombia Ltd. (37.5%); the block carries an additional
royalty of 2%. This block has an area of 209,488 hectares and is located to
the southeast of the Rubiales field. The first exploration phase will require
a minimum investment of US$32 million, to be spent on acquiring 850 km of 2D
seismic and drilling three exploratory wells.
SSJN3: The company has a 100% working interest and it offered an
additional royalty of 2% for the block. This block has an area of 256,718
hectares and is located 70 km north of the La Creciente Gas Field discovered
and operated by the company. The first exploration phase includes the
acquisition of 500 km of 2D seismic and the drilling of one exploratory well,
for a total investment of US$23 million.
SSJN7: This block was awarded to a consortium formed by Pacific Stratus
(50%) and ONGC Videsh (50%), offering an additional royalty of 14%. The block
has an area of 270,702 hectares and is adjacent to the La Creciente Gas Field
to the west. The first exploration phase will require an investment of US$23
million, to be spent on the acquisition of 550 km of 2D seismic and the
drilling of one exploratory well.
CR1: This block was awarded to a consortium formed by Pacific Stratus
(60%) and Petrobras Colombia Limited (40%); and the block carries a 22%
additional royalty. The block, with an area of 124,394 hectares, is located in
the northernmost part of the Cesar-Rancheria Basin in the La Guajira Peninsula
on the boundary with Venezuela. This area is highly prospective because it
represents the western extension of the Maracaibo Basin into the Colombian
territory. The first exploration phase will require an investment of US$12
million, to be spent on the acquisition of 250 km of 2D seismic and the
drilling of one exploratory well.
With the completion of the bidding process, Pacific Rubiales has become
the second largest company in Colombia, measured by total acreage for
exploration and production. The exploration activities planned for these
blocks must be completed within 36 months from the signature of the contracts;
the company expects that the first expenditures will occur in 2010. Pacific
Rubiales has already executed the bidding round minutes and the final
signature of the contracts with the ANH is expected to take place by
Commenting on the outcome of the bidding process, Ronald Pantin, Chief
Executive Officer of the company, stated "We are very pleased with the results
of the bidding round because it validates our strategy and consolidates our
position in two of the basins where the company has focused its exploration
and production activities of heavy oil and gas, namely the Llanos Orientales
and Lower Magdalena Basins."
Pacific Rubiales, a Canadian-based company and producer of natural gas
and heavy crude oil, owns 100 percent of Meta Petroleum Limited, a Colombian
oil operator which operates the Rubiales and Piriri oil fields in the Llanos
Basin in association with Ecopetrol S.A., the Colombian national oil company.
The company is focused on identifying opportunities primarily within the
eastern Llanos Basin of Colombia as well as in other areas in Colombia and
northern Peru. Pacific Rubiales has a current net production of approximately
30,000 barrels of oil equivalent per day, with working interests in 26 blocks
in Colombia and blocks 135, 137 and 138 in Peru.
Boe may be misleading, particularly if used in isolation. A boe
conversion ratio of 6 mcf:1 bbl is based on an energy equivalency conversion
method primarily applicable at the burner tip and does not represent a value
equivalency at the wellhead.