Bengal Energy Announces Largest Drilling Campaign in Company
History and Operational Update
CALGARY, ALBERTA--(Marketwired - Mar 31, 2014) - Bengal Energy
Ltd. (TSX:BNG) ("Bengal" or the "Company") is pleased to announce
the commencement of the largest drilling campaign in the Company's
history, with 15 wells planned to be drilled over the next 12
months. Bengal also provides details about this drilling program
and an update on its ongoing operations in both Australia and
India.
Operational
Update
A summary of the drilling program and upcoming milestones in
both Australia and India follows.
Cuisinier Drilling- Calendar 2014
Bengal is very pleased to announce its calendar 2014 Cuisinier
drilling program (within Authority to Prospect "ATP" 752 - Barta
Permit, 30.357% working interest ("WI")) commenced the week of
March 25, 2014 with the spud of the Cuisinier-14 development well.
Under the 2014 program, Bengal and its joint venture partners (the
"JV") plan to drill up to 10 vertical wells in two distinct phases,
including 8 development / appraisal wells and 2 exploration
wells.
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Phase One - Expected to run from late March
2014 to June 2014, with 5 wells expected to be drilled (4
development and 1 exploration) through that period. Each of these
wells will be targeting 52° API, ultra-light crude oil, with the
locations having been selected based on an improved understanding
of the regional geology and enhanced interpretation of 3D seismic.
The Phase One drilling locations were selected based on criteria
observed in the 6 best performing wells of a total of 14 drilled at
Cuisinier by the JV to date. These 6 better performing wells have
demonstrated an average gross initial production rate over 90 days
("IP90") of 360 barrels of oil per day (BOPD). |
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The Company plans to drill one exploration
well in the Company's Barta/Cuisinier area targeting both the
Cuisinier-type productive Murta zone as well as the deeper Birkhead
- Hutton zones. The Birkhead-Hutton zones are very prolific
producers in other analog pools within the Cooper basin. There are
a number of locations for this exploration well currently under
final review. All of these prospects have targeted independent
structural closures within the Cuisinier North 3D area immediately
adjacent to the Cook and Cuisinier oil fields. |
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Phase Two - Expected to commence in calendar
mid-Q4, 2014, during which the JV will drill 4
development/appraisal wells and 1 exploration well at Cuisinier.
The JV will benefit from results obtained in Phase One and will be
able to use that information to high-grade locations for Phase Two
with a view to enhancing productivity and expanding the boundaries
of the pool. The exploration well is planned for the end of Phase
Two, (calendar Q1 2015) and will test another Cuisinier North
prospect which has been identified on 3D seismic just north of the
producing Cook and Cuisinier fields. Due to the phased drilling
approach, production impacts at Cuisinier will be staggered through
the balance of calendar 2014. With success, Phase One wells are
expected to be tied in during calendar Q3 2014 and Phase Two wells
are expected to come on-stream at the end of the fourth calendar
quarter of 2014. |
Bengal plans to announce the overall results of Phase One upon
completion of that part of the drilling campaign.
Wompi
In the Wompi Permit (ATP 752 - WI 38%), the JV is planning to
drill one exploration well in calendar Q3 2014 targeting Birkhead,
Westbourne and Adori formations known to produce in the offsetting
Bowen Field located immediately north of the proposed location.
Wompi offers Bengal moderate risk exploration in a
well-established, oil producing fairway featuring multi-zone
potential.
Tookoonooka
In Bengal's Tookoonooka area (ATP 732), partner Beach Energy
concluded the acquisition of 300 km2 of new 3D seismic across the
block in February, which was fully funded by Beach under the terms
of the Joint Venture Agreement ("JVA") with Bengal. The JVA terms
provide for Beach to expend AUD$11.5 million to acquire the 3D
seismic and drill up to two wells to earn a 50% interest in the
Tookoonooka block. The first exploration well was drilled in late
2013 but was not commercial. The seismic data will now undergo
processing with interpretation to follow. The new 3D seismic will
be utilized to aid Beach and Bengal in selecting the location for
the next exploration well to be funded by Beach under the terms of
the JVA. This seismic will also be used in evaluating a number of
future prospects for a potential series of exploration wells that
are expected to be drilled at Tookoonooka under the JVA.
Onshore India
In Bengal's onshore India block situated within the Cauvery
Basin (CY-ONN-2005/1 - 30% WI), the Company continues to coordinate
with its partners, Gas Authority of India Ltd. ("GAIL") and Gujarat
State Petroleum Corporation ("GSPC") for the drilling of three
exploration wells. The wells are expected to be drilled by GAIL,
the operator, and the first is expected to commence by mid Q3
calendar 2014. The delays that the Company has experienced with
respect to this project have stemmed from regulatory and permitting
issues, which are aggressively being addressed by the operator.
Bengal continues to work with its partners and the relevant
government bodies to advance drilling.
Funding of Capital
Program
Bengal expects to fund its share of the costs under Phase One of
its Cuisinier drilling campaign and the exploration programs at
Tookoonooka and onshore India through sources such as current cash
on hand, ongoing cash flow and its ability to expand on existing
financing arrangements if necessary. Bengal is evaluating a number
of lending options with a variety of Canadian-based and
international lenders to finance the remainder of its capital
programs and provide flexibility respecting future development
across all of its permits, at the lowest possible cost of
capital.
"The Bengal team has worked extremely hard with its partners to
develop a 2014 drilling program that could potentially have the
largest impact on the Company in its history. We are very pleased
to commence this program which anticipates the drilling of 15 new
wells across 4 different onshore permits," said Chayan Chakrabarty,
President and CEO of Bengal. "Bengal is very well positioned to
provide our shareholders with an exciting, catalyst-rich period
over the next 10 -12 months."
Bengal also advises that an updated presentation will be posted
on the Company's website no later than April 4th, which contains
additional information pertaining to the calendar 2014 drilling
program.
About Bengal
Bengal Energy Ltd. (TSX:BNG) is an international oil and gas
exploration and production company with producing and prospective
light oil‐weighted assets in Australia and India. Bengal offers
exposure to lower risk, current production and cash flow, combined
with longer‐term high, potential impact exploration projects. The
Company's strategy is to achieve per share growth in cash flow,
production and reserves while establishing an attractive portfolio
of future drilling and exploration opportunities. Additional
information is available on our website at www.bengalenergy.ca.
Forward-Looking Statements
This news release contains certain forward-looking
statements or information ("forward-looking statements") as defined
by applicable securities laws that involve substantial known and
unknown risks and uncertainties, many of which are beyond Bengal's
control. These statements relate to future events or our future
performance. All statements other than statements of historical
fact may be forward looking statements. The use of any of the words
"plan", "expect", "prospective", "project", "intend", "believe",
"should", "anticipate", "estimate", or other similar words or
statements that certain events "may" or "will" occur are intended
to identify forward-looking statements. The projections, estimates
and beliefs contained in such forward looking statements are based
on management's estimates, opinions, and assumptions at the time
the statements were made, including assumptions relating to: the
impact of economic conditions in North America, Australia, India
and globally; industry conditions; changes in laws and regulations
including, without limitation, the adoption of new environmental
laws and regulations and changes in how they are interpreted and
enforced; increased competition; the availability of qualified
operating or management personnel; fluctuations in commodity
prices, foreign exchange or interest rates; stock market volatility
and fluctuations in market valuations of companies with respect to
announced transactions and the final valuations thereof; results of
exploration and testing activities; and the ability to obtain
required approvals and extensions from regulatory
authorities.
We believe the expectations reflected in those
forward-looking statements are reasonable but, no assurances can be
given that any of the events anticipated by the forward-looking
statements will transpire or occur, or if any of them do so, what
benefits that Bengal will derive from them. As such, undue reliance
should not be placed on forward-looking statements. Forward-looking
statements contained herein include, but are not limited to,
statements regarding: the carrying out of a 10 well drilling
program by the Company at Cuisinier in 2014 in two phases,
including the timing to drill, tie-in and put on production the up
to 10 wells to be drilled and the timing to announce results of
such drilling, the timing to drill one exploration well on the
Wompi permit, the timing for the Company to interpret seismic and
evaluate prospective drilling locations in the Tookoonooka area,
the timing for the drilling of up to three exploration wells
onshore India, the funding by the Company of its share of the costs
of the first phase of drilling at Cuisinier out of ongoing cash
flow and the timing for the Company to enter into a credit
facility. The forward looking statements contained herein are
subject to numerous known and unknown risks and uncertainties that
may cause Bengal's actual financial results, performance or
achievement in future periods to differ materially from those
expressed in, or implied by, these forward-looking statements,
including but not limited to, risks associated with: the failure to
obtain required regulatory approvals or extensions; failure to
satisfy the conditions under farm-in and joint venture agreements;
failure to secure required equipment and personnel; changes in
general global economic conditions including, without limitations,
the economic conditions in North America, Australia, India;
increased competition; the availability of qualified operating or
management personnel; fluctuations in commodity prices, foreign
exchange or interest rates; changes in laws and regulations
including, without limitation, the adoption of new environmental
and tax laws and regulations and changes in how they are
interpreted and enforced; the results of exploration and
development drilling and related activities; the ability to access
sufficient capital from internal and external sources; and stock
market volatility. Readers are encouraged to review the material
risks discussed in Bengal's Annual Information Form under the
heading "Risk Factors" and in Bengal's annual MD&A under the
heading "Risk Factors". The Company cautions that the foregoing
list of assumptions, risks and uncertainties is not exhaustive. The
forward-looking statements contained in this news release speak
only as of the date hereof and Bengal does not assume any
obligation to publicly update or revise them to reflect new events
or circumstances, except as may be require pursuant to applicable
securities laws.
Barrels of Oil Equivalent
When converting natural gas to equivalent barrels of oil,
Bengal uses the widely recognized standard of 6 thousand cubic feet
(mcf) to one barrel of oil (boe). However, a 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. Given that the value ratio based on
the current price of crude oil as compared to natural gas is
significantly different from the energy equivalency of 6:1,
utilizing a conversion on a 6:1 basis may be misleading as an
indication of value.
Bengal Energy Ltd.Chayan ChakrabartyPresident & Chief
Executive Officer(403) 205-2526Bengal Energy Ltd.Jerrad
BlanchardChief Financial Officer(403)
205-2526investor.relations@bengalenergy.cawww.bengalenergy.ca
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