CruzSur Energy announces that after implementing the Work Program approved by the National Hydrocarbons Agency-ANH, successfully carried out the repair work in the Aruchara 1 well, located in the María Conchita Block in the region of La Guajira in northern Colombia. After drilling the cement plugs and controlling the well, DSTs (Drill Stem Test) were carried out to determine the origin, pressure and volume of natural gas, to be able to repair and complete the well and have it secured.

This well was re-entered recently, as discussed in the Company news release of July 24, 2020. Three DST procedures of this well were conducted from August 5 to 19, 2020 during the re-entry and the results are outlined below:

The first DST procedure occurred between August 5 and 8, 2020, over a period of approximately 80 hours using 24/64’, 36/64’ and 48/64” choke sizes. The interval evaluated was between 8,052 and 8,062 feet measured depth. The well resulted at a maximum rate of 7.75 MMscf/d through a 48/64” choke at a pressure of 2,075 psig over a three hour period with a final shut-in pressure of 3,505 psig.

The second DST procedure occurred between August 11 and 14, 2020, over a period of approximately 63 hours using the above-mentioned same choke sizes. The interval evaluated was between 8,111 and 8,121 feet measured depth. The well resulted at a maximum rate of 10.98 MMscf/d through a 48/64” choke at a pressure of 2,437 psig over a three hour period with a final shut-in pressure of 3,547 psig.

The third DST procedure occurred between August 17 and 19, 2020 over a period of approximately 52 hours using the same choke sizes. The intervals evaluated were from 8,088 to 8,094 feet and from 8,111 to 8,121 feet measured depth. Preliminary outcomes show that the well resulted at a maximum rate of 10.420 MMscf/d through a 48/64” choke at a pressure of 2,271 psig with a final shut-in pressure of 3,521 psig. The absolute open flow potential is estimated at 19.0 MMcf/d and a potential of 14.3 MMcf/d with a 50% drawdown.

Previously, the Aruchara-1 well was assigned 10.5 Bcf proved undeveloped marketable gas reserves and 16.9 proved + probable undeveloped marketable gas reserves in the Upper Miocene sands in the 2019 year-end reserves report. With the above data which was conducted in a much longer period of time and with more details in the additional Middle Miocene sands, increased natural gas reserves would be realized in the Maria Conchita Block. The Company intends to have an updated reserve report soon.

Based on these results, management estimates there will be a substantial increase in resources compared to the last reserves report. After obtaining the required permits and licenses to build in partnership with Energy Transitions-Plus+ E.S.P, CruzSur is planning the necessary infrastructure to connect the Aruchara 1 well to a nearby main gas line, before the end of the year, with the objective of monetizing its natural gas resources taking advantage of a premium market in Colombia of over US$ 5 / MMBtu.

CruzSur is going to start accelerating its development plan, taking an aggressive yet disciplined development of additional wells on the Maria Conchita field.

The Company is also concentrating efforts to complete the necessary social and environmental licensing procedures in the next weeks to enable the development of the SN-9 field located in Cordoba, Colombia, a prolific hydrocarbon producing region near the Caribbean Coast.

KeyFacts Energy: CruzSur Energy Colombia country profile