Following the Arrangement, ExploreCo will have a highly prospective acreage position and a well-funded balance sheet combined with an experienced team of professionals. ExploreCo will be a growth-oriented exploration and resource development company led by Corey C. Ruttan, current President and Chief Executive Officer of Petrominerales, and John Koch, current Chief Operating Officer. John D. Wright, the founder of Petrominerales, and current Chairman on the Board, will join ExploreCo as Chairman of the Board. Mr. Wright is also the President, Chief Executive Officer and a Director of Lightstream Resources Ltd. (TSX: LTS), a premier Canadian oil and gas exploration and production company combining light oil Bakken and Cardium resource plays with conventional light oil assets. The remainder of the management team and the Board of Directors of ExploreCo will be appointed prior to the closing of the Arrangement.
ExploreCo's assets are focussed in the Reconcavo Basin, onshore Brazil, located 85 kilometres north of the city of Salvador in northeast Brazil. Brazil's first oil production came from this basin in 1939. Since then, over 6,000 wells have been drilled in the basin, with cumulative production exceeding 1.5 billion barrels of light oil from 86 fields. Current production is over 60,000 barrels of oil equivalent per day, and the majority of the basin's production comes from the Sergi, Agua Grande, and Candeias reservoirs. The basin has a well-developed infrastructure network and an active service industry.
Our primary target is the Gomo member of the Candeias formation, which is both mature source rock and contains the prospective reservoir sands. The Gomo is oil saturated and found at depths between 2,500 and 3,200 metres over our existing acreage position. There have been 24 wells drilled by other operators that have identified thick, stacked, oil-bearing sands. The Gomo net pay on these blocks ranges between 10 and 200 metres, averaging 44 metres with porosities ranging from 9 to 15 percent and permeability between 0.1 and 4 millidarcies. Oil quality ranges between 34 and 38 degrees API.
We plan to commence civil works for our initial drilling campaign in mid-October and start drilling the first well on Block 197 in November 2013. This will be followed by wells at Bom Lugar and Block 183. The goal with these initial wells is to demonstrate the commercial viability of the Gomo sands providing the foundation for a large-scale commercialization.
-- Cash of C$100 million (approximately C$90 million after the acquisition of our minority partner's interest);-- Highly prospective land base - 120,013 gross acres (119,321 net acres);-- Large Gomo resource with undiscovered petroleum initially-in-place ("UPIIP") of over 1 billion barrels;-- Over 100 potential development locations;-- Shallow exploration potential including three conventional exploration prospects on Block 177 with an estimated 133 mmbbls of UPIIP;-- Attractive fiscal regime;-- Close proximity to existing infrastructure; and-- Basic shares outstanding 85.0 million.(1)1. Assumes that all stock options, deferred common shares, and incentive shares of Petrominerales are settled for cash prior to closing of the proposed Arrangement. The actual impact of all or any of the Petrominerales stock options, deferred common shares, and incentive shares cannot be assured and assumptions made in this respect are solely for the purposes of the calculations set forth herein.