TIDMTXP
RNS Number : 8915P
Touchstone Exploration Inc.
15 June 2020
CASCADURA-1ST1 PRESSURE ANALYSIS - INDEPENT VERIFICATION OF TEST
RESULTS
CALGARY, ALBERTA (June 15, 2020) - Touchstone Exploration Inc.
("Touchstone", "we", "our", "us" or the "Company") (TSX, LSE: TXP)
is pleased to announce final production test results from the
Cascadura-1ST1 well on the Ortoire exploration block. The final
test results for both the lower test (6,056 to 6,218 feet) and the
upper test (5,570 to 5,915 feet) have been reviewed by the
Company's independent reserves evaluator, GLJ Ltd. ( "GLJ") , and
the following information is intended to complement initial
production test results previously released by on February 6, 2020
and March 11, 2020.
Highlights
Upper test
-- Flow and buildup test results suggest an Absolute Open Flow
("AOF") natural gas rate of 390 million
cubic feet per day ("MMcf/d") at the sandface.
-- Final 24-hour extended flow test rate, limited by capacity of
surface test equipment, averaged 5,472 barrels of oil equivalent
per day ("boe/d"), 86% natural gas, at a final sandface drawdown of
4%. Pressure data suggests that the well was still cleaning up at
the end of the extended test period.
-- Condensate Gas Ratio ("CGR") was 28 barrels of 55deg API
condensate per million cubic feet of natural gas produced
("bbls/MMcf") during the extended flow test.
Lower test
-- Flow and buildup test results suggest an AOF natural gas rate of 92 MMcf/d at the sandface.
-- Final 24-hour extended flow test rate, limited by the
capacity of surface test equipment, averaged 5,157 boe/d, 87%
natural gas, at a final sandface drawdown of 12%. Pressure data
suggests that the well was still cleaning up at the end of the
extended test period.
-- CGR was 26 bbls/MMcf of 55deg API condensate during the extended flow test.
Analysis
-- Gas analysis indicated sweet, liquids rich natural gas with
no hydrogen sulfide and no entrained water.
-- Based on the data obtained during both tests, the
Cascadura-1ST1 reservoir appears to be unbounded within the area of
investigation, confirming a larger pool than originally
anticipated.
-- Absolute Open Flow Potential ("AOFP") modelling indicates
that it is reasonable to design for an initial gross production
rate of between 7,750 and 9,700 boe/d (6,200 to 7,760 boe/d net)
based on estimated gross rates of 40 to 50 MMcf/d of natural gas
and 1,100 to 1,400 boe/d of condensate.
James Shipka, Chief Operating Officer, commented:
" We are extremely pleased with the final testing data and GLJ's
independent analysis of the stage one and stage two information, as
both confirm the tremendous potential of the Cascadura-1ST1
discovery. The low sandface drawdown, high reservoir pressure, and
rapid recovery suggest a sizeable reservoir with excellent
production potential. With minimal drawdown observed while flowing
and with no boundaries seen in the analysis, the pressure data
confirms that the Cascadura pool is larger than the area of
investigation observed during the tests. On this basis, we will
likely require additional drilling and production at Cascadura to
fully understand and optimize production from the structure. We are
now working with GLJ to complete an independent reserves evaluation
for the Cascadura feature, which we expect in July. The evaluation
will use the test data along with wireline logs, analogous pool
data, offset production and seismic to properly assign reserves to
the pool.
The team remains on course to begin drilling at our next
prospect, Chinook, in July, where we are keen to explore a separate
structure along the same geological trend. With several near-term
catalysts for the Company, now is an exciting time for Touchstone,
and we look forward to updating all our stakeholders in due
course."
As previously announced, the Cascadura-1ST1 exploration well
onshore in the Republic of Trinidad and Tobago (Touchstone 80%
working interest operator, Heritage Petroleum Company Limited 20%
working interest) encountered substantial volumes of liquids rich
natural gas in two sand packages in the Herrera Gr7b formation with
a total combined thickness in excess of 777 feet. Evaluation of
these sands was undertaken in two stages with the first test
evaluating 162 feet of pay in the lowermost section of the wellbore
and the second test evaluating 345 feet of pay in the uppermost
section of the wellbore.
Lower Stage One Testing
During the 24-hour extended flow test of the lower interval
(6,056 to 6,218 feet), Cascadura-1ST1 averaged a production rate
26.8 MMcf/d of natural gas and an estimated 691 bbls/d of
condensate (5,157 boe/d, 13% liquids). In this final extended flow
test, the well yielded 55deg API condensate at a ratio of
approximately 26 bbls/MMcf of natural gas produced. Laboratory
analysis of the produced gas indicated liquids rich natural gas
with no hydrogen sulfide content, no entrained water and no
solids.
Following flow testing, the well was shut in for an extended
pressure buildup survey which concluded on February 27, 2020.
During the buildup period, the Company observed bottomhole
pressures returning to pre-test levels of approximately 4,783 psi.
Final downhole flowing pressure at the end of the 24-hour flow test
was 4,221 psi, indicating a sandface drawdown of 12%. Flow and
pressure buildup measurements were then reviewed by GLJ as part of
their pressure transient analysis report. This data suggests an
estimated sandface AOF rate of 92 MMcf/d. No physical boundaries
were observed during the pressure buildup test period, and no skin
damage was visible at the sandface. Pressure data suggests that the
well was continuing to clean up during the extended flow test.
Upper Stage Two Testing
Production testing of the upper interval (5,570 to 5,915 feet)
resulted in an average production rate of 28.1 MMcf/d of natural
gas and an estimated 783 bbls/d of natural gas liquids
(approximately 5,472 boe/d, 14% liquids). During the final extended
flow test, Cascadura-1ST1 yielded 55deg API condensate at a ratio
of approximately 28 bbls/MMcf of natural gas produced. Laboratory
analysis of the produced gas indicated liquids rich natural gas
with no hydrogen sulfide content, no entrained water and no
solids.
Following flow testing, the well was shut in for an extended
pressure buildup survey which concluded on May 13, 2020. During
this buildup period Touchstone observed bottomhole pressures
returning to pre-test levels of approximately 4,728 psi. Final
downhole flowing pressure at the end of the 24-hour flow test was
4,550 psi, indicating a final sandface drawdown of 4%. Flow and
pressure buildup measurements were reviewed by GLJ, indicating in
an estimated sandface AOF rate of 390 MMcf/d. No physical
boundaries were observed during the pressure buildup test period,
and no skin damage was visible at the sandface. Pressure data
suggests that the well was continuing to clean up during the
extended flow test.
Analysis of the data supports an initial gross production rate
of 40 to 50 MMcf/d with an estimated 1,100 to 1,400 bbls/d of
condensate (net production rate of approximately 6,200 to 7,760
boe/d). This initial estimated production rate is based upon the
AOFP modeling performed following analysis of the flow and buildup
pressure data. Touchstone will design the production and surface
facilities to meet these initial production capabilities. These
rates reflect the well production from the upper interval (test
two), with the lower interval (test one) initially isolated, as per
the current well configuration.
Touchstone Exploration Inc.
Touchstone Exploration Inc. is a Calgary based company engaged
in the business of acquiring interests in petroleum and natural gas
rights and the exploration, development, production and sale of
petroleum and natural gas. Touchstone is currently active in
onshore properties located in the Republic of Trinidad and Tobago.
The Company's common shares are traded on the Toronto Stock
Exchange and the AIM market of the London Stock Exchange under the
symbol " TXP " .
For further information about Touchstone, please visit our
website at www.touchstoneexploration.com or contact:
Touchstone Exploration Inc.
Mr. Paul Baay, President and Chief Executive Officer Tel: +1
(403) 750-4487
Mr. James Shipka, Chief Operating Officer
Shore Capital (Nominated Advisor and Joint Broker)
Nominated Advisor: Edward Mansfield / Daniel Bush / Michael McGloin Tel: +44 (0) 207 408 4090
Corporate Broking: Jerry Keen
Canaccord Genuity (Joint Broker)
Adam James / Thomas Diehl Tel: +44 (0) 207 523 8000
Camarco (Financial PR)
Nick Hennis / Billy Clegg Tel: +44 (0) 203 781 8330
Advisories
Forward-Looking Statements
Certain information provided in this announcement may constitute
forward-looking statements within the meaning of applicable
securities laws. Forward-looking information in this announcement
may include, but is not limited to, statements with respect to well
test results; the Company's exploration plans and strategies,
including with respect to the anticipated development and timing of
the Cascadura-1ST1 well and ultimate production therefrom; and the
sufficiency of resources and available financing to fund future
completion operations. Although the Company believes that the
expectations and assumptions on which the forward-looking
statements are based are reasonable, undue reliance should not be
placed on the forward-looking statements because the Company can
give no assurance that they will prove to be correct. Since
forward-looking statements address future events and conditions, by
their very nature they involve inherent risks and uncertainties.
Actual results could differ materially from those currently
anticipated due to a number of factors and risks. Certain of these
risks are set out in more detail in the Company's 2019 Annual
Information Form dated March 25, 2020 which has been filed on
SEDAR and can be accessed at www.sedar.com. The forward-looking
statements contained in this announcement are made as of the date
hereof, and except as may be required by applicable securities
laws, the Company assumes no obligation to update publicly or
revise any forward-looking statements made herein or otherwise,
whether as a result of new information, future events or
otherwise.
Oil and Gas Matters
References in this announcement to production test rates and
initial flow rates are useful in confirming the presence of
hydrocarbons; however, such rates are not determinative of the
rates at which such wells will commence production and decline
thereafter and are not necessarily indicative of long-term
performance or of ultimate recovery. While encouraging, readers are
cautioned not to place reliance on such rates in calculating the
aggregate production for the Company.
Oil and Gas Measures
Where applicable, natural gas has been converted to barrels of
oil equivalent based on six thousand cubic feet to one barrel of
oil. The barrel of oil equivalent rate is based on an energy
equivalent conversion method primarily applicable at the burner
tip, and given that the value ratio based on the current price of
crude oil as compared to natural gas is significantly different
than the energy equivalency of the 6:1 conversion ratio, utilizing
the 6:1 conversion ratio may be misleading as an indication of
value.
Competent Persons Statement
In accordance with the AIM Rules for Companies, the technical
information contained in this announcement has been reviewed and
approved by James Shipka, Chief Operating Officer of Touchstone
Exploration Inc. Mr. Shipka is a qualified person as defined in the
London Stock Exchange's Guidance Note for Mining and Oil and Gas
Companies and is a Fellow of the Geological Society of London (BGS)
as well as a member of the Canadian Society of Petroleum Geologists
and the Geological Society of Trinidad and Tobago. Mr. Shipka has a
Bachelor of Science in Geology from the University of Calgary and
has over 30 years of oil and gas exploration and development
experience.
This information is provided by RNS, the news service of the
London Stock Exchange. RNS is approved by the Financial Conduct
Authority to act as a Primary Information Provider in the United
Kingdom. Terms and conditions relating to the use and distribution
of this information may apply. For further information, please
contact rns@lseg.com or visit www.rns.com.
END
MSCGPURAQUPUPGC
(END) Dow Jones Newswires
June 15, 2020 02:00 ET (06:00 GMT)
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