Talisman Energy Inc. (Talisman) (TSX:TLM) (NYSE:TLM) and Ecopetrol (ECP) (NYSE:EC) (TSX:ECP) (BVC:ECOPETROL) today announced an important milestone towards developing the Akacias field in Block CPO-9 in Colombia in the Department of Meta.
The co-venturers are in the process of completing a successful nine-well appraisal program following the Akacias discovery in 2010, and are now ready to move forward with field development. A Declaration of Commerciality has been submitted to the regulator and a conceptual field development plan will be filed within the next 90 days.
In making the Declaration of Commerciality, the two companies announce the following:
-- Eight successful appraisal wells have been drilled in 2013 in the Akacias field, with one additional well currently drilling.
-- Current production of 7-9 API oil from three wells on long-term test is 5,300 bopd, which will ramp up as the remaining wells are put on long-term test.
-- To date, 1.5 million barrels of oil have been produced from the Akacias-1 discovery well, which commenced long-term test in May 2011 with average production in excess of 2,000 bopd.
-- Transportation of the oil to market is occurring via the capacity the two companies have in the San Fernando and Ocensa pipeline systems.
-- The original oil in place mapped with the currently producing wells is 1.3 billion barrels. Assuming a 10% recovery factor, a 2C contingent resource of 130 million barrels of oil is indicated.
-- Structurally deeper wells drilled but yet to be placed on long-term test indicate greater oil in place; recoverability is yet to be determined.
Upon receipt of the required environmental licence, additional appraisal and development drilling will commence to determine the full extent of the Akacias field. All activity in Akacias and Block CPO-9 will continue to be conducted in a safe, environmentally and socially acceptable manner.
"We are pleased to be working with Ecopetrol as our partner and operator of Block CPO-9 on the important Akacias oil discovery, and are encouraged by the results to date," said Hal Kvisle, President and CEO of Talisman. "We will now move forward to agree on a development plan and obtain the necessary environmental permits. This milestone reflects a material step towards realizing the potential of our Colombian business and will bring significant benefits to Colombia."
"Akacias constitutes one of the major exploration achievements in recent years in Colombia, and clearly shows the heavy crude potential in the Llanos area, the target of Ecopetrol's exploration campaign to reach its goals of producing one million barrels of clean oil equivalent in 2015 and 1.3 million barrels of oil equivalent in 2020. We will continue working together with our partner, Talisman Colombia, in the assessment and development not only of Akacias, but also of the potential existing across all the licensed area," said Ecopetrol's CEO, Javier Gutierrez Pemberthy.
Ecopetrol is the operator of Block CPO-9 and has a 55% interest in the license. Talisman has a 45% interest in the license. The Akacias area borders the Cubarral Block, where the Castilla and Chichimene oil fields are located.