01:17:51 EST Wed 28 Feb 2024
Enter Symbol
or Name

NG Energy International Corp
Symbol GASX
Shares Issued 137,450,742
Close 2023-11-27 C$ 0.96
Market Cap C$ 131,952,712
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NG Energy hires contractors for Sinu-9 construction

2023-11-27 09:10 ET - News Release

Mr. Serafino Iacono reports


NG Energy International Corp., further to the company's press release on Sept. 28, 2023, has signed definitive agreements with INFRAES SAS ESP and Surenergy SAS ESP (the contractors) to complete infrastructure construction required for commercial production from Sinu-9. Since the previous press release, the contractors have advanced all permitting and social work over the right-of-way to near completion, have procured the equipment for the gathering and processing plant, and have received all pipe required for installation. Construction of both the gathering and processing plant and pipeline is under way with the contractors, who remain on target to deliver 30 MMcf/d (millions of cubic feet per day) of pipeline capacity in the first half of 2024.

Gathering and processing plant agreement

The company has contracted Surenergy to provide processing, treatment and compression of natural gas produced from the Sinu-9 block for the gas pipeline that will connect the Sinu-9 block with the Jobo delivery point for the Promigas SA ESP national gas transportation system. Under the terms of the agreement, Surenergy will install three compression packages of 10 MMcf/d and a dehydration plant of 40 MMcf/d, at onset, with an additional 10 MMcf/d of compression available at the company's election. Surenergy is responsible for all capital expenditures and will retain ownership over the assets, and the company will pay a volume-based fee for utilization of such assets over the 10-year term of the agreement.

Pipeline agreement

The company has contracted INFRAES to construct a 32-kilometre, 5.5-inch pipeline, connecting the Sinu-9 field to the Jobo section of the Promigas SA ESP transportation system, which is part of the national transportation system transporting gas to the northern region of Colombia. The company will pay a fixed transportation fee for natural gas volumes transported over the 10-year term of the contract. INFRAES is responsible for all capital expenditures and maintenance, and will retain ownership of the pipeline for the duration of the contract. In addition to the transportation agreement, the company entered into an interruptible supply contract with SA ESP-GEAM for the sale of up to 10,000 MMBtu/d (million British thermal units/day) (approximately 10 MMcf/d) until Nov. 30, 2024. The company intends to execute firm contracts with exceptions following such date, once production is flowing and stabilized from the Sinu-9 block.

Updated resource assessment

With final infrastructure agreements in place, the company has engaged independent qualified reserves and resources evaluator Sproule International Ltd., and anticipates that the updated resource assessment and reclassification of contingent resources to reserves will be completed in Q4 2023.

Serafino Iacono, chief executive officer of NG Energy, commented: "With the halting of new exploration contracts and Colombia currently heading towards a shortage of gas supply, which will be worsened by the El Nino weather phenomenon, and even accounting for import capacity according to Wood Mackenzie data, it is pivotal that current contracts be developed and brought on-line in a timely manner. We are very pleased to have finalized infrastructure agreements with our partners INFRAES and Surenergy, and will look to expand capacity beyond the initial 40 MMcf/d as we develop this large onshore conventional gas field."

About NG Energy International Corp.

NG Energy International is a publicly traded E&P (exploration and production) company on a mission to provide a clean and sustainable solution to Colombia's energy needs. The company intends on executing this mission by producing and bringing gas to the premium-priced Colombian gas market from SN-9, a 311,353-acre block which is adjacent to Canacol's Nelson field, as well as Maria Conchita, a 32,518-acre block located in the region of La Guajira. NG Energy's team has extensive technical expertise, and a proven record of building companies and creating value in South America.

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