Crown Point Energy announces that the Province of Mendoza is reviewing the Company’s economic offer to acquire a 25 year exploitation concession for the Chañares Herrados block, located in the Cuyo Basin, Province of Mendoza.

Crown Point (50% WI), together with partner Petrolera Aconcagua Energía Crown Point(50% WI) (collectively, the “Joint Venture”), had previously registered to participate in an auction process arranged and conducted by the Province of Mendoza to bid for a 25 year exploitation license covering the 40.6 square kilometer Chañares Herrados concession, located approximately 50 kilometers south of Mendoza City in the Cuyo basin.

The Joint Venture offer was opened on December 23rd and is now being reviewed by the Province. The bid includes a cash payment of US$8.3 million (US$4.15 million net to Crown Point), a 13% royalty on oil production and a 10 year, US$85.7 million work program which includes well work overs, infrastructure optimization and a multi- well drilling program. No competing bid was accepted by the Province.

Based on information published by the Secretaría de Energía, in November 2020 the Chañares Herrados concession produced an average of approximately 130 m3 per day (820 barrels per day) of low to medium gravity crude oil. The concession is covered by 3D seismic, is easily accessible, and is close to pipeline infrastructure which delivers oil to the YPF refinery located on the southern outskirts of Mendoza City.

The Province’s review process is expected to take several weeks before the auction result is confirmed. If the Joint Venture is awarded the concession it will be operated by Aconcagua, a private Argentine oil and gas company with an extensive and successful record in mature oil field operations. Crown Point will provide geological and geophysical support to the work program implementation.

KeyFacts Energy: Crown Point Energy Argentina country profile