KEYFACT Energy
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President Energy is an oil and gas company listed on the AIM market of the London Stock Exchange (PPC.L) primarily focused in Argentina, with a diverse portfolio of operated onshore producing and exploration assets. The Company has independently assessed 1P reserves in excess of 16 MMboe and 2P reserves of more than 25 MMboe.
The Company has operated interests in the Puesto Flores and Estancia Vieja Concession, Rio Negro Province, in the Neuquén Basin of Argentina and in the Puesto Guardian Concession, in the Noroeste Basin in NW Argentina. The Company is focused on growing production in the near term in Argentina. Alongside this, President Energy has cash generative production assets in Louisiana, USA and further significant exploration and development opportunities through its acreage in Paraguay and Argentina.
President Energy’s second largest shareholder is the IFC, part of the World Bank Group and is actively pursuing value accretive acquisitions of high quality production and development assets in Argentina capable of delivering positive cash flows and shareholder returns.
Production
Average net Group production in 2020 was up 12% year on year to over 2,700 boepd. Full year 2021 average production projected to be between 3,600 and 4,000 boepd is based on Group capex spend of circa US$18 million.
ARGENTINA
Puesto Flores and Estancia Vieja
President Energy holds a 90% working interest (partner EDHIPSA, provincial oil company) and is the Operator in the Puesto Flores and Estancia Vieja Concessions.
Puesto Flores and Estancia Vieja are two fields located on the edge of the prolific Neuquen Basin in the Rio Negro Province.
19 wells are currently producing at Puesto Flores with the majority utlising Electrical Submersible Pumps “ESP’s”, with 3 additional wells acting as water injectors.
Independently certified reserves as at 31 December 2018 amounted to over 7.8 MMboe of 2P reserves.
Field Type: It is a field with a low density of wells per area drilled to date. The trap, an inverted anticline structure, combined with a substantial number of unconformities and several fluvial & marine reservoirs has at least two active source rock. This constitutes an excellent environment for growth. The field has existing production plus development and in field exploration upside.
History: Chevron acquired the concession in 2001 and held it until it was acquired by President in September 2017. At expiry of the licences in November 2017, the Company obtained as extension to the concession licence terms to 14 Nov, 2027.
29 wells have been drilled in Puesto Flores; cumulative production to-date is some 6.9 million bbls oil and some 22.5 mln m3 of gas with peak production reaching some 3,800 bpd in 2013, before the field entered decline due to Chevron shifting their focus to larger fields.
Puesto Prado
Puesto Prado is interconnected to and borders the north of President’s Estancia Vieja field and covers an area of 57.3 km². It has 23 wells currently shut-in of which some 4 have been reactivated. It also incorporates a newly restored treatment plant which will be able to, by President’s estimates, process some 600 bopd with the oil evacuated by truck direct from the field to a local refinery.
Las Bases
Las Bases, some 15km to the north of and interconnected to Puesto Prado covers 153 km², is a gas field comprising of 6 wells, 2 of which are producing gas, with a compression plant originally built by Chevron Argentina. The plant has recently been partly reactivated and is handling gas from the company’s Angostura and Estancia Vieja fields.
In July 2020, President announced a multi-well drilling and workover programme to take place in Rio Negro, Argentina. Las Bases LB-1001 development well was spudded at the end of September 2020.
The LB-1001 development well was drilled to the target depth of 1,700 metres. A full suite of open hole electronic logging was performed and the well was then successfully cased and cemented. Costs for the well drilled, cased, completed and tested are expected to be within the US$1.9m budget.
The electronic logs indicated a total of 54 metres of net gas pay spread of 6 formations which are in line with pre-drill expectations and likewise in line with the offset former producing well of LB-x1. The main formations of interest showed generally good permeability and porosity with ranges from 15%-20%. The results so far therefore supported the pre-drill probable (P50) expectations both as to initial gas production (100,000 m3/d being 588 boepd) and targeted reserves of 6 Bcf. On 7th December 2020, it was announced that the recently drilled LB-1001 (gas) well has been placed on production, with aggregate production from this well is currently ahead of expectation.
On 26 October 2020, the Company announced that, as a result of the success of the newly drilled LB-1001 at the Las Bases field, Rio Negro Province, there was potential for a workover, perforation and testing of the shut-in well LB-1 to initiate, in the words of the announcement “new previously untapped gas production”.
As of 20 January 2021, LB-1 is free flowing 33,000 m3/d (1.15 MMsft/d or 194 boepd) without having been hydraulicly stimulated. Success case initial production rates per well are 40,000 m3/d (1.4 MMsft/d or 235 boepd).
President has a firm programme to drill four new slim hole gas wells in the Las Bases and Estancia Vieja Concessions in Rio Negro Province commencing during March 2021.
Angostura
The Angostura exploration area, that covers 384 km², lays directly to the west of and is interconnected via gas pipeline to President’s Las Bases field. Gas is currently being produced from three wells and oil from two wells.
There have been 26 wells drilled in Angostura, 4 of which are active.
Puesto Guardian
President Energy holds a 100% operated interest in the Puesto Guardian Concession in Salta Province, Argentina.
The Puesto Guardian Concession is located in the Noroeste Basin in NW Argentina and includes five main fields Puesto Guardian, Dos Puntitas, Pozo Escondido, Canada Grande and Martinez del Tineo.
A productive concession with five active fields and a variety of different reservoirs, such as the prolific Yacoraite A6 aeolian sand and intervals of primary-secondary porosity in the Cretaceous Yacoraite-Las Avispas Limestones. Recent integrated studies performed by President have provided crucial insight unlock the key factors that control the oil accumulations and explain the intermittent successes from the historic original operator.
When the field was acquired, the facilities and operation had deteriorated and the field was not making a return at the operating level.
Since taking control of the field, President has invested in:
- Optimizing the field operations
- Performed workover and acidification campaigns
- Modernized the management of the two production batteries
- Converted the primary lifting method to jet pumps.
The result is that the field production has stabilized around 400 bopd while providing positive net back. 14 wells are currently producing within the Puesto Guardian concession, with 2 wells acting as water injectors. The production of light sweet crude production is trucked to a local refinery in the region.
Outlook: As of 20 January 2021, the Company, in discussions with the Salta Province, is considering drilling two or three vertical oil wells in the currently producing Dos Puntitas field within Puesto Guardian in H2 2021. In order to save time, locations have been identified internally and applications to drill in progress.
Projected initial production for each of these wells is estimated at 45-50 m3/d (300 boepd).
Consideration is also being given to complement the contemplated drilling by acquiring 3D seismic data over the formerly producing Canada Grande and currently producing Puesto Guardian fields later in 2021, as well as some additional 2D data in the Ocultar exploration block. The seismic grid has already been determined.
Canada Grande was a prolific producing field in the history of the Concession with the more successful wells demonstrating initial flow rates of 1,000 bopd. All wells in this field were drilled solely relying on 2D seismic. It is considered that acquiring modern 3D seismic data will assist in identifying undrained areas within the field as well as defining and stepping out from its boundaries. Similarly, acquiring 3D seismic over the Puesto Guardian field where initial production rates were 600 bopd is considered a prudent and potentially rewarding action. Any follow on drilling in Salta arising from the results of this seismic acquisition will likely be in 2022.
Matorras and Ocultar
President Energy holds a 100% operated interest in the Matorras and Ocultar exploration licence areas surrounding Puesto Guardian in Salta Province, Argentina.
Field type: Matorras (1,469 km²), which was President’s highest priority of the three licence areas, is on the same structural trend as the palaeozoic prospect under Martinez del Tineo that was the subject of the Gaffney Cline & Associates (GCA) audited resource report announced on 23 January 2012. GCA assessed the gross unrisked mid case prospective gas and condensate resource of 570 bcf and 14.5 million barrels of condensate.
The Ocultar licence area covers the previously open area to the east of Puesto Guardian.
Should a paleazoic discovery be made under Martinez del Tineo, management believe this new acreage holds significant follow on potential with further identified leads that will be the subject of further study now the licences have been awarded.
The licences have a modest seismic re-processing and new seismic acquisition commitment of US$2 million each with a drill or drop decision after three years.
Outlook: President continues to study the potential of these fields and is actively engaged in seeking an extension to the first exploration period with the province of Salta for 18 months to complete the studies. Entering into the second phase will require the commitment to drill one exploration well.
PARAGUAY
President’s acreage in Paraguay is comprised of four blocks; the Pirity Concession & Pilcomayo Exploration Permit which President operates with 100%, and the Hernandarias Concession which President operates with a 40% interest and right to earn up to 80%. This acreage covers a contiguous area of 26,000 km² and significantly, encompasses the entire prospective area of the Pirity sub-basin within northwest Paraguay, which lies in the more regionally extensive Chaco Basin.
President Energy has carried out an extensive exploration programme in Paraguay, including interpretation of 6,435 km of existing regional 2D, of which 2,098 km has been reprocessed, together with the acquisition of 1,662 km new 2D and 781 km² new 3D seismic surveys by President between 2012 & 2014. This was followed by successful exploration drilling in the Palaeozoic Play on the northern flank of the sub-basin, which resulted in the Lapacho technical discovery. The Lapacho-1 well encountered two potentially significant columns of oil and gas in stacked, fractured Devonian & Silurian reservoirs. Difficult drilling conditions and engineering problems meant it was not possible to flow oil or gas to surface, and the well was abandoned for safety reasons. So, although mobile hydrocarbons were observed in the well, the tests failed to demonstrate commercial deliverability of the oil and gas reservoirs encountered.
The Cretaceous sand and volcanic oil play remains undrilled on the southern flank of the Pirity sub-basin in Paraguay despite being on trend with the Palmar Largo complex in Argentina where light oil is produced from identical good quality Cretaceous sand and volcanic reservoirs. This Palmar Largo complex in Argentina lies only 30 km from similar Cretaceous prospects mapped by President in their Pirity Concession.
President has now mapped over thirty prospects and leads across their combined Concessions in Paraguay, which have a combined estimated ‘mean’ potential of 3 billion boe unrisked prospective conventional oil and gas resources, with large unsurveyed areas on trend with excellent prospectivity. The Cretaceous potential mapped to date in the south-west part of the Pirity Concession includes six prospects and three leads which have been upgraded by recent studies to include an estimated combined prospective resource of over 500 MMboe.
Significantly, in 2017 President completed a geochemical remote-sensing study over proven fields in Argentina and primary prospects in Paraguay, which demonstrated the presence of anomalies over proven fields and also over the newly defined structures President has mapped.
In addition on the southern flank of the basin, below Cretaceous prospects there is a deeper, largely unevaluated Palaeozoic play, as well as unconventional potential, also recognised in the acreage.
USA
President Energy has operated interests in one producing oil and gas field in Louisiana, East Lake Verret (ELV).
The field produces both light sweet crude oil and natural gas from two above water wells, one of which is the Simmons well and the other of which is the Triche well.
Working Interests are respectively approx 43.9% and 70% for these two wells with additional income arising from the Triche use of field processing facilities owned wholly by President.
LEADERSHIP/CONTACT
PETER LEVINE Chairman & Chief Executive
ROB SHEPHERD Group Finance Director
LUCÍA MERCEDES D’AGOSTINO Legal and Administrative Director
JORDAN COLEMAN COO, LatAm
DR MARTIN GEE Head of Sub-Surface
CLAUDIA PEREZ CFO, LatAm
DIEGO DE LA VEGA Supply Chain Director
ULISES MACAGNO Commercial Director
SCOTT DASPIT Head Operations USA
Office headquarters
Carrwood Park, Selby Road, Leeds, LS15 4LG, United Kingdom
Email: info@presidentpc.com
Tel: +44 (0) 20 7016 7950
Argentine Office
Juana Manso 1750, Complejo Zencity, Edificio Esmarelda, 3er Piso Norte
C1107CHJ. Buenos Aires, Argentina
Email: info@presidentpc.com
Tel: +54 (11) 4317 0400