2ND QTR: AMERICAS PETROGAS INC. REVENUES UP 360%
Aug. 31, 2012
Source: Americas Petrogas Inc. news release
To view the entire release, click here.
Americas Petrogas Inc. ("Americas Petrogas" or the "Company") (TSX VENTURE:BOE) announces the Company continued to execute on its investment plan on its oil and gas properties in Argentina and its potash, phosphates, and other minerals project in the Sechura Desert, Bayovar, Peru.
Second Quarter Highlights and Recent Developments
Recently, the Company has been producing an approximate average of gross 2700 bopd (or 429 cubic metres per day). A new daily production record of gross 2830 bopd (or 450 cubic metres per day) was achieved on July 19, 2012 at Medanito Sur and Rinconada Norte.
• Operating netback of $5,855,237 ($45.68 per barrel) during the three months ended June 30, 2012 compared to $1,122,485 ($26.02 per barrel) during the same period of 2011. This improvement of $4,732,752 represents an increase of 422%. See note (1).
• This quarter's net revenue increased by $6,646,155 compared to the second quarter of 2011, which is an increase of over 360%.
• $85.0 million of consolidated cash, cash equivalents and short-term investments as of June 30, 2012.
• Received a 25-year exploitation license, granted by the provincial government, for the Medanito Sur block in March 2012.
• The expansion of the Company's own production facilities to handle up to 6300 bopd of oil from Medanito Sur is well underway and is expected to be complete by the fourth quarter of 2012.
• Eight conventional wells, including five exploration wells, were drilled in the second quarter, all of them successful oil discoveries.
• In June 2012, drilling commenced on the La Hoya.x-1 (LHo.x-1) well, the first Vaca Muerta Shale vertical exploration well drilled on the Company's 90%-owned Totoral block. In July 2012, the LHo.x-1 well was cased and cemented. A full suite of logs and both conventional cores as well as sidewall cores were acquired. Production casing was successfully set to a total depth ("TD") of approximately 6,463 feet. The Company has been conducting detailed analysis of the cores and cuttings at international service company laboratories in Argentina in order to identify fracing and testing options for shale oil or shale gas reservoirs, as well as other identified targets. Equipment is being gathered and logistics are being implemented with fracing and testing planned for the third quarter.
• With joint venture partner, ExxonMobil, commenced the drilling of the ALL.x-1 unconventional, shale exploration well on the Los Toldos I block in July 2012. This is the second well within the farmout agreement between Americas Petrogas Argentina S.A. and ExxonMobil Exploration Argentina S.R.L. Intermediate casing has been set on this vertical well to 1591 metres and drilling is ongoing. The ALL.x-1 well is planned for drilling to TD of approximately 3300 metres (or 10,825 feet) with the principal target being the Vaca Muerta shale and other potential conventional reservoirs including Quintuco, Tordillo and Mulichinco.
• The first well within the farmout agreement, LTE.x-1, was drilled earlier this year on the Los Toldos II block and the cores and logs continue to be analyzed at international service labs to design the fracing and testing plan for that well. Equipment is now onsite to prepare for fracing and testing of this well.
• Testing of the Huacalera well (Hua.x-1) by Apache, as operator, is ongoing.
• Completed pumping tests on the potash brine project in Peru; compilation and analysis of the data is underway. The Company expects a National Instrument 43-101 compliant resource assessment to be available in the fourth quarter of 2012.
• As a follow-up to the 15-borehole drilling program in 2011, the Company recently commenced a new drilling program involving 20 exploration boreholes on its southeastern block at Bayovar to identify the presence and the extent of evaporites, phosphates, gypsum, and other brines.
• We are continuing with our plans to drill unconventional wells, which primarily target the Vaca Muerta shale, on our 90%-owned Totoral, Yerba Buena and Bajada Colorada blocks as well as our Los Toldos blocks with our joint venture partner, ExxonMobil, and on other blocks.
• We are working towards completion of our own production facilities to handle 6300 bopd from Medanito Sur in order to free up some of the limitations of our third-party processors.
• We are continuing the exploration, appraisal and development drilling in the conventional oil prospects in the Medanito Sur and Rinconada Norte blocks, where excellent results have been experienced in the initial period of this program. Production, reserves and cash flow are expected to grow as a consequence of this active drilling program.
• The Company is positioned to increase production, enhance reserves, and deliver solid growth from its large conventional and unconventional drilling program during 2012 and into 2013.
"In executing our 2012 conventional drilling program, we continue to generate positive cash flow from our Eastern blocks." said Barclay Hambrook, President and Chief Executive Officer. "Because of the limited capacity of third party processing facilities and the very positive results on our drilling program, some of our wells are currently shut-in. However, we are fast-tracking the building of our own processing facilities, which should be completed by the fourth quarter. Additionally, we are moving forward with the drilling of unconventional wells, primarily targeting the thick Vaca Muerta shale."