Canoro Resources Ltd.

Canoro Resources Ltd.

October 10, 2007 07:45 ET

Canoro's Amguri 11 Tests in Aggregate at Over 3,100 Boe/d

CALGARY, ALBERTA--(Marketwire - Oct. 10, 2007) - Canoro Resources Ltd. (TSX VENTURE:CNS) has successfully completed all tests at Amguri 11. We perforated 28 meters of the 36 meter Main Barail Sand and flowed at a clean-up test rate as high as 450 bbl/d of condensate and 5.3 mmcf/d of natural gas through a 28/64 inch choke with tubing head pressure of 2,180 psi. This equates to 1,330 boe/d. This main reservoir is four meters thicker than at Amguri 10B and 17 meters thicker than Amguri 6.

The remaining seven meter perforation, approximately 20 meters below the main sand, was tested and was also found to be hydrocarbon bearing. This interval flowed at a clean-up test rate in excess of 280 bbl/d of condensate and 2.1 mmcf/d of natural gas through a 18/64 inch choke with a tubing head pressure of 2,250 psi. This equates to 630 boe/d. A complete test could not be conducted on this interval to determine its full capacity.

With the two new reservoirs and the main sand (totaling 65 meters of net pay), this well flowed at a total of 1,190 bbl/d of condensate and 12 mmcf/d of natural gas. This equates to 3,190 boe/d.

This is by far our most successful result at Amguri to date.

Increased Amguri Production

The surface locations of Amguri 10B and Amguri 11 are 200 meters from existing gas and oil sales facilities at Amguri 6. These two new wells are planned to be tied-in and on production prior to year-end. There will be some facilities preparations required before these wells can be placed on stream at full rates. Even at partial rates initially, these wells will significantly increase oil and natural gas production from Amguri.

Amguri Development Plan

Based on the successful results from Amguri 10B and Amguri 11, we are beginning to prepare an initial development plan for the Amguri field. We are proposing up to eight more wells in the first phase of the plan, six development wells and two more appraisal wells to delineate the main part of the field. It is planned that Amguri 12 be the first well drilled in phase one of the field development, with a proposed location 1,200 meters southwest from Amguri 11 and structurally up-dip. If the appraisal wells are successful, additional development wells will be planned in phase two of the program.

With the rich nature of the natural gas at Amguri, we have begun investigating the installation of facilities that would remove additional liquids from the natural gas produced. These liquids could then be captured and sold at a much higher price then we receive as part of the natural gas stream. Based on early calculations, we believe that we could capture an additional 25 to 50 barrels of liquids per million cubic feet of gas produced.

While the development plan is being prepared and submitted for approval, we are releasing the drilling rig to another operator in Assam for one well or about four months. This operator will provide the joint venture partners with approximately US$1.4 million for their share of the initial mobilization and demobilization charges incurred to bring the drilling rig into Assam, thus reducing our total drilling costs. Further drilling at Amguri is expected to resume during the first quarter of next year.

Canoro is a Canadian-based international oil and gas company operating in the Assam/Arakan basin of northeast India. Canoro is the operator of Amguri field with a 60% working interest. Canoro is the operator with a 65% working interest in the AA-ON/7 exploration block. Canoro also has a 15% non-operated working interest in the AA-ONN 2003/2 exploration block.

Common shares of Canoro trade on the TSX Venture Exchange under the symbol 'CNS'.

This news release contains certain forward-looking statements, including management's assessment of future plans and operations, and capital expenditures and the timing thereof, that involve substantial known and unknown risks and uncertainties, certain of which are beyond Canoro's control. Such risks and uncertainties include, without limitation, risks associated with oil and gas exploration, development, exploitation, production, marketing and transportation, loss of markets, volatility of commodity prices, currency fluctuations, imprecision of reserve estimates, environmental risks, competition from other producers, inability to retain drilling rigs and other services, delays resulting from or inability to obtain required regulatory approvals and ability to access sufficient capital from internal and external sources, the impact of general economic conditions in Canada, the United States and overseas, industry conditions, changes in laws and regulations (including the adoption of new environmental laws and regulations) and changes in how they are interpreted and enforced, increased competition, the lack of availability of qualified personnel or management, fluctuations in foreign exchange or interest rates, stock market volatility and market valuations of companies with respect to announced transactions and the final valuations thereof, and obtaining required approvals of regulatory authorities. Canoro's actual results, performance or achievements could differ materially from those expressed in, or implied by, these forward-looking statements and, accordingly, 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, including the amount of proceeds, that Canoro will derive therefrom. Readers are cautioned that the foregoing list of factors is not exhaustive. All subsequent forward-looking statements, whether written or oral, attributable to Canoro or persons acting on its behalf are expressly qualified in their entirety by these cautionary statements. Furthermore, the forward-looking statements contained in this news release are made as at the date of this news release and Canoro does not undertake any obligation to update publicly or to revise any of the included forward-looking statements, whether as a result of new information, future events or otherwise, except as may be required by applicable securities laws.

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.

The TSX Venture Exchange does not accept responsibility for the adequacy or accuracy of this News Release.

Contact Information

  • Canoro Resources Ltd.
    Rob McInnis
    Vice President, Business Development and Corporate Affairs
    (403) 543-5748
    (403) 543-5740 (FAX)
    Canoro Resources Ltd.
    2810, 715 - 5th Ave SW
    Calgary, Alberta T2P 2X6