Mr. Jim McFarland reports
VALEURA ANNOUNCES ENCOURAGING DRILLING RESULTS AND COMMENCEMENT OF COMPLETION & TESTING OPERATIONS ON THE INITIAL TWO BANARLI EXPLORATION WELLS
Valeura Energy Inc. has released encouraging drilling results and commenced completion and testing operations on its initial two exploration wells Bati Gurgen-1 and Yayli-1 on its 100-per-cent-owned-and-operated Banarli licences in the Thrace basin of Turkey. In anticipation of further positive results, equipment procurement, pipeline right-of-way agreements and the finalization of gas marketing arrangements have continued to advance targeting first gas sales from Banarli by the end of January, 2016. The Energy Market Regulatory Authority in Turkey has also granted the corporation's Turkish affiliate a natural gas wholesale marketing licence to facilitate sales from Banarli.
"We are encouraged by the initial exploration drilling results, which are supported by extensive wireline logging analysis, and we are expecting positive confirmatory flow testing results in the coming weeks," said Jim McFarland, president and chief executive officer. "A further operational update will be provided in early January. Banarli has the potential to provide a significant boost to our net sales volumes in the first quarter of 2016, given the leverage of our 100-per-cent ownership position at Banarli.
"The estimated final cost of $5.5-million (U.S.) for this initial two-well exploration drilling, completion, testing and tie-in program at Banarli is being fully funded from cash on hand and operating cash flow, leaving our balance sheet debt free."
Banarli drilling results (Valeura operated, 100-per-cent working interest)
Bati Gurgen-1 well
The Bati Gurgen-1 exploration well (Valeura 100-per-cent working interest) was spudded on Nov. 10, 2015, with the Viking I-27 rig to test the Osmancik and Mezardere formations in a separate structural closure along the same fault trend as the Gurgen-1 discovery well (Valeura 40-per-cent working interest) located approximately three kilometres to the southeast on the joint venture lands acquired from Thrace Basin Natural Gas (Turkiye) Corp. and Pinnacle Turkey Inc. The Bati Gurgen-1 well was drilled in 11 days to a measured depth of 2,735 metres into the top of the Teslimkoy member of the Mezardere formation. Based on positive log evaluation results, including formation pressure and fluid mobility testing, the Bati Gurgen-1 well was cased to a measured depth of 2,729 metres and the drilling rig was released on Nov. 26. The completion and flow testing program for the well commenced on Dec. 9 and will initially include further cased-hole evaluation of the tight gas potential in the Mezardere formation followed by the main completion of shallower, conventional stacked sands in the Osmancik formation.
Yayli-1 well
The Yayli-1 exploration well (Valeura 100-per-cent working interest) was spudded on Dec. 1, 2015, with the Viking I-27 rig to test the Osmancik and Mezardere formations in a separate structural closure located 2.2 kilometres northwest of and along the same fault trend as the Bati Gurgen-1 well. The Yayli-1 well was drilled in 11 days to a measured depth of 2,914 metres to evaluate a thicker section of the Teslimkoy member. Mud weights and log results indicate that the Mezardere formation is overpressured below approximately 2,500 metres in both the Bati Gurgen-1 and Yayli-1 wells. Based on positive log evaluation results, the Yayli-1 well was cased to total depth. Rig release is expected on Dec. 18. Completion and testing of the well are expected to commence in early January following release of the service rig from the Bati Gurgen-1 well.
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