CALGARY, ALBERTA -- (Marketwired) -- 04/02/13 -- Touchstone Exploration Inc. (TSX VENTURE: TAB) ("Touchstone" or the "Company") is pleased to provide the following operations and production update.
-- Current field estimated production of approximately 2,550 bbls/d.-- Second quarter field estimated production of approximately 2,000 bbls/d.-- 2013 exit production guidance of 3,000 - 3,300 bbls/d.-- Resumption of the 2013 drilling program scheduled for April 8, 2013 with up to 12 additional wells planned.
In mid-November Touchstone made the strategic decision to suspend its drilling program to focus on two key areas. The first was to improve the production from existing wells and put in place a strategy to deal with mobile sands that were impeding oil production. The second was to secure the required approvals and equipment to assure that upon recommencement of drilling Touchstone would be able to recognize the economic savings associated with a continuous drilling program. Touchstone plans to recommence its 2013 drilling program with rig mobilization beginning April 8, 2013.
Together with improved utilization of existing equipment, the Company has made both personnel and procedural changes to increase production from existing wells. Touchstone refers to this as duty factor and has seen an almost two-fold increase from approximately 48% in December 2012 to 80% in March 2013 under the new structure. Based on field estimates, sales production volumes for the period of January 1, 2013 to March 31, 2013 averaged approximately 2,000 bbls/d. Current field estimated production is approximately 2,550 bbls/d.
A number of key properties can be highlighted to explain the significant production increase during a period where no new wells were drilled. The WD-4 property, which was acquired in November 2012, has been integrated and is presently producing in excess of 645 bbls/d based on field estimates. The WD-8 property has now exceeded production volumes of 980 bbls/d based on field estimates due to an improved duty factor and full utilization of the coil tubing unit over the past 90 days. The main focus of the coil tubing unit has been the cleanout of sand filled wellbores along with perforation washes that have proven highly successful. The other property of note is Fyzabad where the Company drilled two wells in late October that now have current combined field estimated production of 200 bbls/d. As a result of the success of the production optimization program, the Company has now increased its field estimated September 30, 2013 exit production guidance to between 3,000 and 3,300 bbls/d.
In addition to the four wells drilled in the first quarter, the balance of the 2013 drilling program will include up to 12 additional wells drilled before the end of Touchstone's fiscal year-end of September 30, 2013. The Company plans to begin with two shallow development wells at Fyzabad drilled to depths of approximately 2,200 feet. The program will then move to the WD-8 property to drill two wells targeting the Cruse formation. The program will then proceed to the Coora block for a minimum of two wells before returning to the WD-4 and WD-8 properties. Ron Bryant, Touchstone's President and COO said "it is exciting to see the drilling program get back underway and the success that we have achieved on the production front is very encouraging for the 2013 and 2014 programs".