East West Petroleum (EW-V) sets $13.9-million capital budget for 2013 - Insider buying canadianinsider.com
Feb 7th, 2013 - News Release
East West Petroleum Corp. has provided details on its 2013 capital budget of $13.9-million, which will be fully financed through the company's existing cash balance of approximately $25-million.
The 2013 capital program will focus on exploration drilling on the company's established acreage positions in New Zealand, Romania and California, and is summarized as tabulated.
Gross Net capital capital Number spend to EWLocation Permit of wells ($M) ($M)
New Zealand 54877 (EW 30%) 5 $10.5 $6.0
New Zealand 54879 (EW 50%) 3 6.3 4.1
New Zealand 54876 (EW 50%) 1 2.1 2.1
Romania Tria (EW 15%) 2 8.0 0.0
California Tejon Ranch Extension (EW 25%) 1 1.3 0.5
California Tejon Ranch Main (EW 25%) 1 5.0 1.2
Total 13 $33.2 $13.9
New Zealand
As announced on Dec. 11, 2012, the company was awarded three oil and gas concessions in New Zealand's Taranaki basin, alongside its partner and operator TAG Oil Ltd. The licences have at least 10 shallow, low-risk, drill-ready prospects, and additional leads have been identified, which lie in close proximity to TAG's producing Cheal oil field. The nine-well drilling campaign is expected to commence on permit 54877 in late second quarter or early third quarter of this year.
The Urenui and Mount Messenger sands are the primary productive horizons in this area of the Taranaki basin. Recent wells have averaged net pay of 17 metres and have tested initial production rates of 950 barrels of oil equivalent per day
Romania
The formal approval for the company to commence operations on the EX-2 Tria block in Romania was announced on Dec. 5, 2012. The block covers 250,000 acres in the Pannonian basin, and numerous leads and prospects have been identified based on existing seismic data. Through its farm-out agreement with Naftna Industrija Srbije j.s.c. Novi Sad (NIS), the company will be fully carried through the phase 1 exploration period, which will include the drilling of three wells on the block. The first well is expected to be spudded by the third quarter of 2013.
The company is awaiting the formal approval to commence operations on its other three blocks that have been awarded in Romania. Under the terms of the farm-out agreement with NIS, the company will be fully carried through three wells on each block, and any seismic and additional technical work, following formal ratification which is expected to take place in the first half of 2013. Should NIS and the company choose to proceed to enter the phase 2 exploration period, the company will be fully carried through to commerciality on each block.
California
In California, the company plans to participate in the drilling of one Tejon Main exploration well with its partner, North American Oil & Gas Corp. The company recently completed the drilling of its pass exploration No. 1 well on its Tejon Extension lease. A testing program has commenced, with results to be announced shortly.
Greg Renwick, president and chief executive officer, commented: "Our 2013 capital program marks an important turning point for the company, moving from an asset-acquisition phase to asset-evaluation phase. New Zealand, Romania and California have the potential to become core producing areas for the company in 2013, and we are excited to be working with partners such as TAG and NIS. TAG has established itself as one of the premier operators in New Zealand, having drilled 20 consecutive successful wells in the Taranaki basin, while NIS is leading explorer in the Pannonian basin with extensive operations in adjacent areas in northern Serbia."
In addition, East West has uploaded an updated corporate presentation to its website.
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