AIM listed President Energy provides an operational update in relation to its current Rio Negro operations in the Estancia Vieja and Puesto Flores fields.

Workover Programme

The operational testing of EVx-1 has now concluded.

The flow rates and pressure build up support the initial testing results and that this has proved to be excellent value for the US$250k expended in working over an old, uneconomic well. The well tested on various choke sizes from 4mm to 12mm for 12 hours each with similar pressure build up tests at 12 hour intervals. Throughout, the well maintained good pressure with production rates ranging from 25,000m3/d up to 150,000m3/d of gas with a small amount of condensate. For good reservoir management, subject to the definitive data results, it is expected that the well will be put on stream initially producing approximately 80,000m3/d of gas (+/-470 boepd). The data obtained from the testing is now being analysed to determine the producible volume of the reservoir and its characteristics.

The Company looks forward to seeing the contribution in production from this well from October.

The order in respect of the second well in the workover sequence was changed due to logistics. This well, the old PFO-33, has been turned into a water disposal well replacing a previous disposal well PFO-17 which ceased to be operable some three months ago. PFO-33 is now capable of disposing of 400m3/d of water thereby saving on third party costs which have been incurred since the previous well ceased to inject. The workover of this well has been completed ahead of time and like EVx-1, under budget.

After completing the workover of PFO-33, the rig then moved on to the oil producer PFE-1001 to replace an electric submersible pump which had failed approximately two months ago and then put the well back on production. That operation is now nearly completed and has gone according to plan. The well should be back online in the next 7-10 days.

The rig will then move on to the next wells in the sequence which will include the well EV-20 referred to in the Company's announcement of 13 July 2020. Further details of progress on the programme will be announced at relevant times.

Drilling programme

The drilling rig is now expected to start mobilising during the course of this week for drilling operations to commence on schedule before the end of September.

As previously announced, the first well will be the Las Bases 1001 development well targeting attic gas in the Las Bases structure, a P50 well rate of 100,000 m3/day (588 boepd) of gas and 6 Bcf of recoverable gas with a target depth of 1,700 metres and a high chance of success.

Estimated costs to completion are US$1.9 million with drilling time, excluding completion and tie-in, of approximately 21 days. As the well is in close proximity to existing infrastructure, on a success case the well should be in production at some stage during November.

KeyFacts Energy: President Energy Argentina country profile