BPZ Energy Announces 2013 Capital Plan and Provides Block Z-1 Operational
HOUSTON, Jan. 22, 2013 (GLOBE NEWSWIRE) -- BPZ Energy (NYSE:BPZ) (BVL:BPZ), an
independent oil and gas exploration and production company, today announced
its 2013 capital investment program and provided a Block Z-1 operational
2013 BUSINESS PLAN
The Company plans to spend approximately $27 million net in 2013 on capital
and exploratory expenditures, excluding capitalized interest, for its three
onshore blocks in which the Company holds 100% working interests, as the
capital and exploratory expenditures for offshore Block Z-1 are fully carried
by Pacific Rubiales Energy Corp. (TSX:PRE) (BVC:PREC) (BOVESPA:PREB) under the
joint venture agreements.
The Company's 51% share of Block Z-1 capital investments to be fully carried
by Pacific Rubiales Energy Corp. is budgeted at $79 million ($149 million
gross). Planned activities at Block Z-1 include CX-15 developmental drilling
for six wells and projects and engineering at the Corvina and Albacora fields.
On a contingent basis, the budget includes a two-well drilling program and
facilities at the Albacora field should 3D seismic dictate a return to
drilling, and a Corvina gas pipeline to shore related to the proposed
gas-to-power project. In addition, exploratory expenditures include the
completion of 3D seismic survey-related activity, including processing, as
well as other engineering projects.
Planned capital and exploratory expenditures onshore include contingent
amounts subject to receipt of necessary permits which include $12 million for
shallow drilling activities at Block XXIII as well as $9 million of 3D and 2D
seismic work for Blocks XIX and XXII, respectively. Other expenditures of $6
million are also included.
BLOCK Z-1 OPERATIONAL UPDATE
In the following discussion please note all numbers are "net" in reference to
BPZ Energy's 51% working interest in Block Z-1, unless noted as "gross" which
references the 100% combined BPZ and Pacific Rubiales Energy Corp. gross
working interest in Block Z-1.
Total average combined production from the Corvina and Albacora fields at
offshore Block Z-1 was 1,517 (2,973 gross) and 1,688 (3,310 gross) barrels of
oil per day (bopd), for the fourth quarter and full year ended December 31,
2012, respectively. January 2013 production to date from these two fields is
averaging approximately 1,533 bopd (3,005 bopd gross).
Phase II of the original 1,600 square kilometer seismic acquisition project on
Block Z-1 is now complete. Initial data processing for the PUD drilling
locations at the Corvina field is also complete with interpretation underway.
Processing of the data acquired over the Albacora field is being prioritized.
The total gross cost of the Z-1 seismic program, is now anticipated to be
approximately $52 million, or approximately $10 million higher than the
previously announced estimate of $42 million. The increase in expenditures is
mainly due to higher costs related to the expanded work scope, less efficiency
from a smaller seismic boat and vessel standby required as a result of
significant fishing activity during Phase II of the seismic acquisition
Corvina Field Development
Since the beginning of the New Year, the Corvina oil field has been producing
approximately 1,188 bopd (2,330 bopd gross).
Subsea pipeline interconnections between the CX-11 and CX-15 platforms are now
substantially complete. This project has experienced delays due to unusually
strong current conditions which prevented divers from completing work required
in the pipe laying process. This also affected the start of the CX-15 drilling
rig mobilization as the tender barge and pipe laying barge could not operate
in the same location. With the pipe laying barge clearing the area, the Don
Fernando vessel with Petrex 28 drilling rig onboard as well as the associated
tender barge are now moving alongside the CX-15 platform and the rigging up
process is beginning. As a result, timing of the first well spud at the CX-15
platform is now expected to occur in early February 2013, with first oil
production expected during second quarter 2013.
Likewise, the CX-11 workover program has also been affected by the delays in
the pipe laying project in Corvina related to barge logistics and is expected
to resume in February.
The total gross cost of the CX-15 project is now anticipated to be
approximately $83 million, $6 million higher than the previously announced
estimate of $77 million, due to the higher costs associated with the platform
The Albacora field during January 2013 is producing approximately 344 bopd
(675 bopd gross). The gas compressor and the produced water injection
equipment installed in 2012 have been commissioned and are working. The
existing contract for the Petrex 18 rig has been renegotiated to allow for
improved day rates and cancellation terms, and availability to use it should
the new 3D seismic data dictate a return to drilling.
PRESIDENT AND CEO, MANOLO ZUÑIGA COMMENTED, "With the New Year comes a new
chapter in the growth of our Company as we begin drilling again at Block Z-1.
After a period of preparation including the design, fabrication and
installation of the new CX-15 platform, as well as acquiring 3D seismic, we
now have a very promising multi-well development project ready to begin at the
Corvina field. The new 3D seismic at Block Z-1 is showing us interesting
opportunities that will mature into an exploration program. Onshore, we
continue to make preparations for future drilling at all three blocks with
work to obtain additional seismic and drilling permits underway."
ABOUT BPZ ENERGY
Houston-based BPZ Energy, which trades as BPZ Resources, Inc. under ticker
symbol BPZ on the New York Stock Exchange and the Bolsa de Valores in Lima, is
an independent oil and gas exploration and production company which has
license contracts for oil and gas exploration and production covering
approximately 2.2 million gross acres in four properties in northwest Peru.
The Company holds a 51% working interest and Pacific Rubiales Energy Corp.
holds a 49% working interest in offshore Block Z-1, for which current activity
includes the development of the Corvina oil discovery, as well as the
redevelopment of the Albacora field.
In addition, the Company is pursuing the exploration of onshore Blocks XIX,
XXII and XXIII, in parallel with the execution of an integrated gas-to-power
strategy, which includes generation and sale of electric power in Peru and the
development of a regional gas marketing strategy. The Company also owns a
non-operating net profits interest in a producing property in southwest
Ecuador. Please visit the Company's website at www.bpzenergy.com for more
FORWARD LOOKING STATEMENT
This Press Release contains forward-looking statements within the meaning of
the Private Securities Litigation Reform Act of 1995, Section 27A of the
Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934.
These forward looking statements are based on our current expectations about
our company, our properties, our estimates of required capital expenditures
and our industry. You can identify these forward-looking statements when you
see us using words such as "will," "expected," "estimated," and "prospective,"
and other similar expressions. These forward-looking statements involve risks
Our actual results could differ materially from those anticipated in these
forward looking statements. Such uncertainties include successful installation
of our new platform in Corvina, the success of our project financing efforts,
accuracy of well test results, results of seismic testing, well refurbishment
efforts, successful production of indicated reserves, satisfaction of well
test period requirements, successful installation of required permanent
processing facilities, receipt of all required permits, the successful
management of our capital expenditures, and other normal business risks. We
undertake no obligation to publicly update any forward-looking statements for
any reason, even if new information becomes available or other events occur in
CAUTIONARY STATEMENT REGARDING CERTAIN INFORMATION RELEASES
The Company is aware that certain information concerning its operations and
production is available from time to time from Perupetro, an instrumentality
of the Peruvian government, and the Ministry of Energy and Mines ("MEM"), a
ministry of the government of Peru. This information is available from the
websites of Perupetro and MEM and may be available from other official sources
of which the Company is unaware. This information is published by Perupetro
and MEM outside the control of the Company and may be published in a format
different from the format used by the Company to disclose such information, in
compliance with SEC and other U.S. regulatory requirements.
Additionally, the Company's joint venture partner in Block Z-1, Pacific
Rubiales Energy Corp. ("PRE"), is a Canadian public company that is not listed
on a U.S. stock exchange, but is listed on the Toronto (TSX), Bolsa de Valores
de Colombia (BVC) and BOVESPA stock exchanges.As such PRE may be subject to
different information disclosure requirements than the Company.Information
concerning the Company, such as information concerning energy reserves, may be
published by PRE outside of our control and may be published in a format
different from the format the Company uses to disclose such information,
incompliance with SEC and other U.S. regulatory requirements.
The Company provides such information in the format required, and at the times
required, by the SEC and as determined to be both material and relevant by
management of the Company.The Company urges interested investors and third
parties to consider closely the disclosure in our SEC filings, available from
us at 580 Westlake Park Blvd., Suite 525, Houston, Texas 77079; Telephone:
(281) 556-6200.These filings can also be obtained from the SEC via the
internet at www.sec.gov.
CONTACT: Investor and Media Contact:
A. Pierre Dubois
Investor Relations & Corporate Communications
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