DEVELOPMENT AND DRILLING PLANS
Development and drilling operations will commence in TDF after the ten year extension to 2026 has been approved.
The Company plans to acquire additional 3D seismic on the Las Violetas, Angostura Sur and Rio Cullen concessions starting in 2014. The proposed Las Violetas 3D seismic program is designed to fully evaluate and identify drilling targets over areas and trends, which have been mapped using older 2D seismic. The Angostura Sur and Rio Cullen seismic programs are following up exploration leads from existing 2D seismic and geological information.
CERRO DE LOS LEONES, NEUQUEN BASIN, ARGENTINA
The Company's 100% interest in the Cerro de Los Leones exploration concession covers approximately 306,646 acres in the Mendoza portion of the Neuquen Basin.
EXPLORATION, DEVELOPMENT AND DRILLING PLANS
Crown Point has completed the Cerro de los Leones seismic programs comprised of 122 kilometers of 2D seismic and 143 square kilometers of 3D seismic. Field recording of both seismic programs has been completed, the processing of data is nearing completion and interpretation of the data has commenced. The total cost of the two seismic programs is estimated to be $6 million.
Drilling on various conventional plays is expected to commence in late 2013, following interpretation of the seismic programs. Information obtained from these wells will assist Crown Point in determining the economic viability of the Vaca Muerta shale play on the Cerro de Los Leones concession. A second 3D seismic program is planned for the eastern portion of the concession targeting both structural plays and stratigraphic resource type plays. This program may be shot in 2014 and would be followed up with the drilling of one to two wells targeting the above mentioned plays.
Following the initial drilling phase, Crown Point may consider additional exploration and development drilling in the area, including the possibility of drilling vertical and horizontal tests in the Vaca Muerta shale play.
EL VALLE, SAN JORGE BASIN, ARGENTINA
Crown Point has a 50% working interest in an approximate 15,864 acre area in the El Valle area of the Golfo San Jorge Basin. The Company has an 80% interest in the production of all wells drilled by Crown Point on this concession until payout of 300% of the costs to drill, complete, equip and tie in each well. El Valle has three distinct productive sedimentary formations, which, in descending order from shallow to deep, are the Canadon Seco, Caleta Olivia and Mina el Carmen. Each of these formations may contain multiple discrete hydrocarbon bearing sandstone zones. Typically, the Canadon Seco oil produces medium grade oil (API gravity that ranges from 24 to 28 degrees ), while the Caleta Olivia and Mina el Carmen produce lighter oil (API gravity of approximately 30 degrees ). The Company has developed a drilling inventory consisting of 12 development drilling and eight new exploration drilling targets in the El Valle field. Additionally, potential exists for secondary recovery programs such as water flood or horizontal drilling, plus workovers and recompletions on existing wells.
2012 DRILLING PROGRAM
Since Crown Point commenced drilling operations on the El Valle concession, the Company has drilled and completed 18 wells (16 oil wells, 1 suspended potential oil well and 1 non-producing natural gas well) with no dry holes.
During calendar 2012, Crown Point drilled 5 successful oil wells on the El Valle concession for a total cost of $12.7 million. This program, which commenced in April 2012, was focused on the drilling of development oil wells with multiple-zones targeted in the Canadon Seco and Caleta Olivia formations in the south east and south central areas of El Valle.
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