| Pacific Rubiales Reaches Production Milestone of 100,000 barrels per day; Provides Corporate Development Update 17:01 EDT Thursday, October 22, 2009 | |
TORONTO, Oct. 22 /CNW/ - Pacific Rubiales Energy Corp. (TSX: PRE) announced today that it has reached the historical milestone of exceeding the 100,000 barrels of oil equivalent per day (boepd) of gross operated production, equivalent to 41,138.14 boepd net after royalties.
Mr. Ronald Pantin, Chief Executive Officer, commented: "This milestone is the result of the growth strategy that the company has been pursuing since the merger in January 2008 with Pacific Stratus. On the strength of our technical knowledge, our high quality assets and an ongoing focus on low-cost and rapid production growth, we were able to achieve this milestone. This success is a clear signal of our management team's ability to deliver on our objectives now and going forward, as the pre-eminent independent operating company in the Colombian basin."
The 100,000 boepd milestone is a result of the sharp growth in production of heavy oil in the Rubiales/Piriri blocks, principally as a result of the ODL pipeline now in full use, and the volumes coming out of the exploratory wells in the Quifa Block. It also incorporates the development of the light and medium oil blocks and the natural gas volume produced from La Creciente block and other smaller fields. A breakdown of production is below:
<< ------------------------------------------------------------------------- PRODUCT GROSS NET (after royalties) ------------------------------------------------------------------------- Heavy Oil 85,317.98 bopd 30,518.15 bopd ------------------------------------------------------------------------- Light/Medium Oil 5,813.00 bopd 1,841.99 bopd ------------------------------------------------------------------------- Natural Gas 53.95 mmscfd 52.67 mmscfd (8,778 boepd) (8,992 boepd) ------------------------------------------------------------------------- Total 100,122.91 boepd 41,138.14 boepd ------------------------------------------------------------------------- >>
Corporate Development Update
Management estimates that for the three months ended September 30, 2009, the company produced approximately 2,363,692 barrels (bbl) of oil and 642,141 boe of natural gas. Average daily production for the month of September 2009 was approximately 24,390 bbl/d of oil and 6,669 boe of natural gas. Average prices for the third quarter of 2009 were approximately US$64.01 per barrel of oil and US$23.89 per boe of natural gas.
Third quarter 2009 financial statements are still in the process of preparation and therefore financial statements for this period are not yet available. However, based on information reviewed to date, management estimates that net sales for the third quarter of 2009 were approximately US$156.5 million.
Construction of the ODL Pipeline
The ODL joint venture company was initially financed through capital contributions. The joint venture company has obtained bank and capital markets financing and, as a result, it is now able to distribute back to the company and to Ecopetrol a portion of the initial capital contributions. The company expects to receive US$21 million in the last quarter of 2009 and an additional US$21 million by early 2010.
Pacific Rubiales, a Canadian-based company and producer of natural gas and heavy crude oil, owns 100 percent of Meta Petroleum Corp., a Colombian oil operator which operates the Rubiales and Piriri oil fields in the Llanos Basin in association with Ecopetrol S.A., the Colombian national oil company. The company is focused on identifying opportunities primarily within the eastern Llanos Basin of Colombia as well as in other areas in Colombia and northern Peru. Pacific Rubiales has a current net production 41,000 of oil equivalent per day (after royalties), with working interests in 32 blocks in Colombia and Peru.
Boe may be misleading, particularly if used in isolation. A boe conversion ratio of 6 mcf: 1 bbl is based on an energy equivalency conversion method primarily applicable at the burner tip and does not represent a value equivalency at the wellhead.
Cautionary Note Concerning Forward-Looking Statements
This press release contains forward-looking statements. All statements, other than statements of historical fact, that address activities, events or developments that the company believes, expects or anticipates will or may occur in the future (including, without limitation, statements regarding estimates and/or assumptions in respect of production, revenue, cash flow and costs, reserve and resource estimates, potential resources and reserves and the company's exploration and development plans and objectives) are forward-looking statements. These forward-looking statements reflect the current expectations or beliefs of the company based on information currently available to the company. Forward-looking statements are subject to a number of risks and uncertainties that may cause the actual results of the company to differ materially from those discussed in the forward-looking statements, and even if such actual results are realized or substantially realized, there can be no assurance that they will have the expected consequences to, or effects on the company. Factors that could cause actual results or events to differ materially from current expectations include, among other things: uncertainty of estimates of capital and operating costs, production estimates and estimated economic return; the possibility that actual circumstances will differ from the estimates and assumptions; failure to establish estimated resources or reserves; fluctuations in petroleum prices and currency exchange rates; inflation; changes in equity markets; political developments in Colombia or Peru; changes to regulations affecting the company's activities; uncertainties relating to the availability and costs of financing needed in the future; the uncertainties involved in interpreting drilling results and other geological data; and the other risks disclosed under the heading "Risk Factors" and elsewhere in the company's annual information form dated April 1, 2009 filed on SEDAR at www.sedar.com. Any forward-looking statement speaks only as of the date on which it is made and, except as may be required by applicable securities laws, the company disclaims any intent or obligation to update any forward-looking statement, whether as a result of new information, future events or results or otherwise. Although the company believes that the assumptions inherent in the forward-looking statements are reasonable, forward-looking statements are not guarantees of future performance and accordingly undue reliance should not be put on such statements due to the inherent uncertainty therein.
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