27.06.2006 13:25:00
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Toreador Initiates Natural Gas Production in Romania and Provides Operational Update
-- Initial production rate approximately 6 MMCFG and 30 BBLS of condensate per day set to start on Romanian Fauresti Permit
-- Romanian exploratory drilling program on Viperesti permit to begin in September. Three wells scheduled for 2006 with reserve potential per prospect of 12 to 105 million barrels of oil equivalent ("MMBOE")
-- Installation of 1st Black Sea production tripod underway on the Akkaya structure in the South Akcakoca Sub-Basin
-- Construction of the gas processing plant to support the South Akcakoca Sub Basin and production from adjacent area began on June 26, 2006
-- Update on the Ken D - #1 well in Hungary and related activity on the Szolnok and Tompa Exploration permits
Toreador Resources Corporation (Nasdaq:TRGL) today announced thatit will begin producing natural gas on June 30 in Romania from itsFauresti Field rehabilitation project at an expected rate, based onextensive pre-production testing, of approximately 6 million cubicfeet of gas and 30 barrels of condensate per day. The initialproduction is from five wells that were re-entered in late 2005 andearly 2006 and re-completed as natural gas producers.
Romania
The Fauresti Field was discovered in 1970 and has produced anaggregate volume of 7.6 million barrels of oil and 46 billion cubicfeet of natural gas. Toreador was awarded the rehabilitation permit inlate 2003 and began its re-entry program in late 2005. The company hasthree more wells to re-enter to complete its eleven well program. Ofthe eight wells re-entered to date five have been re-completed as gasproducers and one as an injection well. New field wells may be addedat a later date.
The company also announced today the results from its initialexploration program on the Viperesti permit which is located in thefoothills of the Carpathian Mountains in the southeast part of thecountry. Geological and reprocessing and reinterpretation of primarily1992 vintage geophysical data has enabled the company's technicalteam, based in both Dallas and Bucharest to delineate ten prospects inthe multiple producing trends that are present in the area. Afterreviewing analogous production on adjacent permits, the companyestimates that the prospects identified thus far have a the potentialfor recoverable reserves ranging from 12 to 105 MMBOE each. Toreadorhas previously announced a capital budget for 2006 that provided fundsfor three exploratory wells on this permit in the second half of theyear. The first of these exploratory wells will be spudded inSeptember of this year. Toreador is operator and owns 100% of theViperesti permit.
Turkey
Toreador and its partners, TPAO (the Turkish national oil company)and Stratic Energy Corporation, have begun installation of the firstproduction tripod in its South Akcakoca Sub-basin project offshoreTurkey in the Black Sea. The installation will be completed within oneweek barring any adverse weather conditions. The tripod, which is thefirst in a series of three Phase I production facilities, will belocated on the Akkaya structure. The "Saturn" jackup, which is beingused to set the tripod in place, will tie back the Akkaya wells to thetripod before the rig is released.
In related news, Toreador disclosed that the Bayhanli-1 welltested 7.2 million cubic feet of gas per day from 14.5 meters (48feet) of perforations through a 32/64" choke with a flowing wellheadpressure of approximately 1,100 psi. As previously announced, the wellwas drilled on a new prospect to the east of the Dogu Ayazli structurealong the same fault trend. The "Prometheus" jack-up rig, which wasused to test the Bayhanli-1, is currently drilling the Kuzey Akkayaprospect in a new area to the north of the Akkaya structure. Uponcompletion, the Prometheus will move to a new location to drill theDogu Ayazli #3 well.
The company also announced today GAMA Power Systems Corporation, awell-respected construction company based in Turkey, has startedconstruction on the mechanical portion of the onshore productionfacility for the South Akcakoca Sub-basin project, at a site that hasbeen prepared near the town of Cayagzi on the Turkish coast. This isthe last major construction contract to be awarded in the first phaseof development. The company expects the plant to be operational by endOctober. The first phase will have a through put capacity of 75 MMCFDwhich can be expanded to 150 MMCFD to handle gas that could be addedfrom areas adjacent to the South Akcakoca Sub Basin and is to be fullyoperational in early November and connected to the already completedonshore pipeline to the operator of the Turkish national gas grid,BOTAS.
Hungary
In Hungary, the Ken-D-1 exploration well successfully penetratedits Pannonian channel sand objective, which contained gas as expected.Analysis of the gas content indicated a mixture of carbon dioxide andmethane. The company, while disappointed that this well was notcompleted outside of the carbon dioxide "ring" that is prevalent inthis immediate area, is confident that the project remains economicalwhen the gas is co-mingled with the production from two previouslydrilled wells. The two wells were part of the Toreador acquisition ofall of the assets of Pogo Producing, Inc. in the Republic of Hungary.Other options are available to the company in this one isolated areain the northeast corner of the Szolnok Block which might include asale of all three wells to a neighboring producer. Discussions areunderway with neighboring producers who now handle quantities ofcarbon dioxide. The value of the three well package is approximately$3.0 million. Consistent with Toreador's 2006 capital expenditureprogram, three more exploration wells will be drilled on the Tompapermit starting in August.
France
Beginning in October, Toreador will begin its previously announcedexploration program on the Courtenay permit. The Company will drillthe first of three wells. Further exploration and development willcontinue into the first quarter of 2007 depending on the results ofthe first three wells.
On the Neocomian permit development drilling will continue duringthe second half of 2006. The first of four planned wells will bespudded in September.
Toreador has completed negotiations on a twelve month contract ona drilling rig in France in order to fulfill its planned commitmentsin 2006 and 2007. More details will be provided after the execution ofthe final contract
Toreador expects to announce the results of its mid-yearengineering reserve study by the end of July. The study will includecompany-wide proved and probable reserves along with possible andpotential reserves for the South Akcakoca Sub-basin.
"The exploration and development plans set out for 2006 are movingalong at a good pace," said G. Thomas Graves III, Toreador Presidentand Chief Executive Officer. "We are particularly pleased with theresults of our first round of geological and geophysical work inRomania. The potential "upside" of our planned drilling on ourViperesti permit exceeds our initial expectations. The Turkish BlackSea drilling program has continued to yield strong results as the lastpieces of the production infrastructure are put in place. Before theend of the year, we will begin the first production from Turkey'soffshore Black Sea coast. It is exciting to be a part of what is trulya frontier play."
About Toreador
Toreador Resources Corporation is an independent internationalenergy company engaged in the acquisition, development, explorationand production of natural gas, crude oil and other income-producingminerals. The company holds interests in developed and undeveloped oiland gas properties in France, Hungary, Romania and Turkey. In theUnited States, Toreador primarily owns working interests in fivestates. More information about Toreador may be found at the company'sweb site, www.toreador.net.
Safe-Harbor Statement -- Except for the historical informationcontained herein, the matters set forth in this news release are"forward-looking statements" within the meaning of Section 27A of theSecurities Act of 1933, as amended, and Section 21E of the SecuritiesExchange Act of 1934, as amended. Toreador intends that all suchstatements be subject to the "safe-harbor" provisions of those Acts.Many important risks, factors and conditions may cause Toreador'sactual results to differ materially from those discussed in any suchforward-looking statement. These risks include, but are not limitedto, estimates of reserves, estimates of production, future commodityprices, exchange rates, interest rates, geological and politicalrisks, drilling risks, product demand, transportation restrictions,the ability of Toreador to obtain additional capital, and other risksand uncertainties described in the company's filings with theSecurities and Exchange Commission. The historical results achieved byToreador are not necessarily indicative of its future prospects. Thecompany undertakes no obligation to publicly update or revise anyforward-looking statements, whether as a result of new information,future events or otherwise.
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