GeoPark Holdings Limited ("GeoPark"), the Latin American oil and gas explorer, operator and consolidator with operations and production in Chile, Colombia, Brazil and Argentina, is pleased to announce the discovery of a new oil and gas field on the Flamenco Block in Chile following the successful testing of the Chercán 1 well - the first well drilled by GeoPark in Tierra del Fuego. GeoPark operates and has a 50% interest in the Flamenco Block in its partnership with Empresa Nacional de Petroleo de Chile ("ENAP"), the Chilean state-owned company.
GeoPark drilled and completed the Chercán 1 well to a total depth of 2,066 metres. A production test in the Tobifera formation, following stimulation, at approximately 1,920 metres, flowed at a rate of approximately 4.0 million standard cubic feet per day of gas and 35 barrels of oil per day through a choke of 8 millimetres, with a well head pressure of 1,800 pounds per square inch. Further production history will be required to determine stabilized flow rates and the well is continuing to clean up. Efforts have been initiated to design and construct flowlines to connect the Chercán 1 well to the existing pipeline infrastructure.
The Chercán 1 well is the first of approximately 21 exploratory wells to be drilled on the Flamenco, Campanario and Isla Norte Blocks in Tierra del Fuego as part of an approximately US$100 million investment program by GeoPark during the First Exploration Period. Two additional wells - Omeling 1 and Yakamush 1 - have completed drilling on the Flamenco Block and will be tested in the following weeks.
As part of the Tierra del Fuego work program, approximately 1,200 sq km of 3D seismic have been surveyed over the three blocks; from a total committed 3D seismic program of approximately 1,500 sq km.
In its partnership with ENAP under the framework of the Special Operation Contracts signed with the State of Chile, GeoPark operates and has a 50% working interest in the Flamenco and Campanario Blocks and a 60% working interest in the Isla Norte Block. ENAP, owns the remaining working interests in each Block.
GeoPark has interests in 27 exploration, development and production blocks in Colombia, Chile, Argentina and Brazil (subject to local regulatory approval). During 2013, GeoPark plans to carry out a total 35-45 well drilling program with an expected work program investment of US$200-230 million.
Commenting, James F. Park, CEO of GeoPark, said: "A new field discovery with our first well drilled in Tierra del Fuego is an encouraging start to our US$100+ million work program in this new region. Our team is confident in the hydrocarbon potential of our new acreage in Tierra del Fuego - which we believe will allow us to replicate the success of our properties nearby to the north across the Magellan Straits. The Chercán 1 well test represents initial confirmation of this potential and our opportunity to continue to build our reliable Chilean production, reserve and cash flow base. We are also pleased to work and be in partnership with ENAP in exploring and developing these exciting opportunities."
In accordance with the AIM Rules, the information in this announcement has been reviewed by Salvador Minniti, a geologist with 32 years of oil and gas experience and Director of Exploration of GeoPark.