Ecopetrol and Pacific Rubiales announce decision concerning the Quifa SW STAR
TORONTO, July 24, 2014 /CNW/ - Ecopetrol S.A. (BVC: ECOPETROL; NYSE: EC; TSX:
ECP) ("Ecopetrol") and Pacific Rubiales Energy Corp. (TSX: PRE; BVC: PREC;
BOVESPA: PREB) ("Pacific Rubiales") announced at a meeting yesterday of
Ecopetrol's board of directors in which the Synchronized Thermal Additional
Recovery ("STAR") pilot project being developed in an area of the Quifa SW
field was considered; and based on the technical analysis of the pilot a
decision was made to adopt the recommendations included in the technical
report prepared on June 6, 2014, entitled: "Joint Pacific Rubiales Energy -
Ecopetrol S.A meeting, a review of the technical results of the STAR project"
The Report was prepared by technical teams appointed by Ecopetrol and Pacific
Rubiales on April 22, 2014 to jointly examine the results of the STAR pilot
project. The Report is limited to the results of the pilot project and does
not constitute a ruling on the assessment of the STAR technology.
The recommendations contained in the Report are as follows:
In light of the fact that Ecopetrol and Pacific Rubiales are in agreement to
consider that the STAR pilot project has provided sufficient information
required for the evaluation of the technology and has reached the final
approved date, both companies agree to recommend that:
-- The STAR pilot project be concluded.
-- That the process of closing the project should be carried out
by reducing on a scheduled basis the injection of air in the
IV2 well in order to obtain additional information concerning
the extinction of the thermal front in the area of the STAR
pilot project in the Quifa SW field. In the time that remains
of the authorized injection approved by the Agencia Nacional de
Hydrocarburos ("ANH"), the injection air flow should be reduced
until it has reached zero flow by the authorized end-date. The
closing process should be carried out in a manner that ensures
the operational continuity of the Quifa partnership, safety
conditions and environmental regulations.
-- A technical team be appointed to conduct a comprehensive
Ecopetrol and Pacific Rubiales will closely monitor the conclusions resulting
from this post-pilot study. The pilot project allowed the companies to acquire
valuable knowledge and experience concerning the use of technologies based on
in-situ combustion recovery.
The two companies reiterate their interest in continuing to work together on
the analysis and development of these and other initiatives that will help
increase recovery factors and hydrocarbon production in joint operated fields
to the benefit of both companies and the country.
Pacific Rubiales, a Canadian company and producer of natural gas and crude
oil, owns 100% of Meta Petroleum Corp., which operates the Rubiales, Piriri
and Quifa heavy oil fields in the Llanos Basin, and 100% of Pacific Stratus
Energy Colombia Corp., which operates the La Creciente natural gas field in
the northwestern area of Colombia. Pacific Rubiales has also acquired 100% of
Petrominerales Ltd, which owns light and heavy oil assets in Colombia and oil
and gas assets in Peru, 100% of PetroMagdalena Energy Corp., which owns light
oil assets in Colombia, and 100% of C&C Energia Ltd., which owns light oil
assets in the Llanos Basin. In addition, the Company has a diversified
portfolio of assets beyond Colombia, which includes producing and exploration
assets in Peru, Guatemala, Brazil, Guyana and Papua New Guinea.
The Company's common shares trade on the Toronto Stock Exchange and La Bolsa
de Valores de Colombia and as Brazilian Depositary Receipts on Brazil's Bolsa
de Valores Mercadorias e Futuros under the ticker symbols PRE, PREC, and PREB,
Ecopetrol is the largest company in Colombia and is integrated into the oil
chain; it is among the 50 major oil companies in the world and among the four
main ones in Latin America. Besides Colombia - where it generates over 60% of
the national production - it is present in exploration and production
activities in Brazil, Peru & US (Gulf of Mexico). Ecopetrol owns the largest
refinery in Colombia and most of the pipeline and multi-product pipeline
network in the country, and is significantly increasing its participation in
Cautionary Note Concerning Forward-Looking Statements
This press release contains forward-looking statements. All statements, other
than statements of historical fact, that address activities, events or
developments that the Company believes, expects or anticipates will or may
occur in the future (including, without limitation, statements regarding
estimates and/or assumptions in respect of production, revenue, cash flow and
costs, reserve and resource estimates, potential resources and reserves and
the Company's exploration and development plans and objectives) are
forward-looking statements. These forward-looking statements reflect the
current expectations or beliefs of the Company based on information currently
available to the Company. Forward-looking statements are subject to a number
of risks and uncertainties that may cause the actual results of the Company to
differ materially from those discussed in the forward-looking statements, and
even if such actual results are realized or substantially realized, there can
be no assurance that they will have the expected consequences to, or effects
on, the Company. Factors that could cause actual results or events to differ
materially from current expectations include, among other things: uncertainty
of estimates of capital and operating costs, production estimates and
estimated economic return; the possibility that actual circumstances will
differ from the estimates and assumptions; failure to establish estimated
resources or reserves; fluctuations in petroleum prices and currency exchange
rates; inflation; changes in equity markets; political developments in
Colombia, Peru, Guatemala, Brazil, Papua New Guinea or Guyana; changes to
regulations affecting the Company's activities; uncertainties relating to the
availability and costs of financing needed in the future; the uncertainties
involved in interpreting drilling results and other geological data; the
impact of environmental, aboriginal or other claims and the delays such claims
may cause in the expected development plans of the Company and the other risks
disclosed under the heading "Risk Factors" and elsewhere in the Company's
annual information form dated March 13, 2014 filed on SEDAR at www.sedar.com.
Any forward-looking statement speaks only as of the date on which it is made
and, except as may be required by applicable securities laws, the Company
disclaims any intent or obligation to update any forward-looking statement,
whether as a result of new information, future events or results or otherwise.
Although the Company believes that the assumptions inherent in the
forward-looking statements are reasonable, forward-looking statements are not
guarantees of future performance and accordingly undue reliance should not be
put on such statements due to the inherent uncertainty therein.
In addition, reported production levels may not be reflective of sustainable
production rates and future production rates may differ materially from the
production rates reflected in this press release due to, among other factors,
difficulties or interruptions encountered during the production of
This news release was originally prepared in the Spanish language and
subsequently translated into English and Portuguese. In the case of any
differences between the Spanish version and its translated counterparts, the
Spanish document should be treated as the governing version.
SOURCE Pacific Rubiales Energy Corp.
Christopher (Chris) LeGallais Sr. Vice President, Investor Relations +1 (647)
Roberto Puente Sr. Manager, Investor Relations +57 (1) 511-2298
Kate Stark Manager, Investor Relations +1 (416) 362-7735
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CO: Pacific Rubiales Energy Corp.
-0- Jul/24/2014 10:00 GMT
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