Pan Orient Energy Corp.

Pan Orient Energy Corp.

November 06, 2006 07:00 ET

Pan Orient Energy Corp. Provides Thailand Update

CALGARY, ALBERTA--(CCNMatthews - Nov. 6, 2006) - Pan Orient Energy Corp. (TSX VENTURE:POE) -



- The high impact exploration well POE-7 is about to commence drilling.

- An additional high impact exploration well, POE-9, has been added to the Phase 1 program.

- A new producing oil reservoir in the "G" sandstone will add incremental oil production. Other zones, including the primary target "F" sandstone, are still to be tested:

-- POE-6 producing oil at a stabilised rate of 45 bopd from the "G" sandstone from outside current production area, and

-- POE-2 producing oil at a stabilised rate of 40 bopd from the "G" sandstone.

- A new producing oil reservoir in the "H" sandstone with POE-3 currently flowing oil on test.

- The development well POE-5 has been drilled, logged, cased and is awaiting testing of some of the best potential oil zones encountered to date.

POE-6 Production Testing

The testing of the "G" sand, the first of four potential oil zones encountered at POE-6, has been completed with initial rates of flush production greater than 200 bopd recorded before stabilising at approximately 45 bopd. To confirm reservoir performance, the "G" sand will be produced for a period of approximately 20 to 30 days before additional zones are perforated. Flow from all additional zones will be commingled.

The well was drilled inside an existing production licence recognising significant updip potential to the north within the adjacent L44 exploration permit with the crest of the structure mapped on seismic to be some 100 meters higher to the north of POE-6. Two deviated wells drilled by an earlier operator penetrated the "G" sandstone in this compartment prior to encountering the target "F" sandstone objective in the main Wichian Buri Field, previously the only reservoir completed for commercial production. Both wells encountered good "G" sandstone reservoirs with individual sandstones up to 10 meters in net thickness, which were never tested. Further wells will be required to fully evaluate the extent of this new producing oil reservoir.

Prior to the drilling of POE-6, there were no proven reserves assigned to this POE-6 fault compartment.

POE-2 Production Testing

Testing has been completed in the "G" sand, one of two zones interpreted as hydrocarbon bearing on the basis of open hole logs. Production is currently stable at 40 bopd and represents the first "G" sand production within the main Wichian Buri field. To confirm reservoir performance, the "G" sand will be produced for a period of approximately 20 to 30 days before the "F" sand is perforated and flow commingled. Prior to the drilling of POE-2, there were no proven reserves assigned to the "G" sand in the Wichian Buri field.

POE-3 Production Testing

Testing has commenced from the "H" sand, one of three zones interpreted as hydrocarbon bearing on the basis of open hole logs. The well is still cleaning up with no stabilised rates to report; however, oil is being recovered at surface. Upon completion of testing from the "H" sand, the "G" and "F" sands will be perforated and production commingled. The "F" sand encountered at POE-3 is one of the best encountered within the Wichian Buri field and is 4 meters structurally higher than the WB-1 well, the best producer in the field. Prior to the drilling of POE-3, there were no reserves assigned to the "H" sand in the Wichian Buri field.

POE-5 Development Well

Drilling, logging and casing of the POE-5 development well, the sixth well of the current eight well program, has been completed. Interpretation of open hole logs indicate net hydrocarbon pay of approximately 15 meters in the "F" sand and 8 meters in the "H" sand. As with POE-3, the hydrocarbon potential of the "G" sand is inconclusive on logs although production from the "H" sand at POE-3 has positive implications for the "G" sand in both POE-3 and POE-5. Testing is anticipated to commence shortly.

POE-7 Exploration Well

The Aztec #7 rig is currently rigging up on POE-7, an appraisal to the HP-1 well drilled in 2002 that encountered 3 meters of hydrocarbons at the top of the "F" sand. POE-7 was positioned on the basis of the newly acquired 3D seismic survey and is located approximately 1.5 kilometers south and 75 meters structurally higher than HP-1. The prospect is deemed moderate risk, high impact, by management.

POE-9 Exploration Well

POE-9 has just been added to the current drilling program and will be the last well drilled in Phase 1. This location is an appraisal of the Na Sanun-1 well drilled in 1997 that flowed approximately 1,400 bopd from a fractured volcanic sill before watering out. POE-9 is located approximately 400 meters east and 150 meters updip from Na Sanun-1, targeting a number of volcanic sills within structural closure. The prospect is deemed moderate risk, high impact, by management.

Pan Orient is a Calgary, Alberta based oil and gas exploration and production company with operations currently located onshore Thailand and in Western Canada.

This news release contains forward-looking information. Forward-looking information is generally identifiable by the terminology used, such as "expect", "believe", "estimate, "should" "anticipate" and "potential" or other similar wording. Forward-looking information in this news release includes, but is not limited to, references to: well drilling programs and drilling plans, estimates of reserves and potentially recoverable resources, and information on future production and project start-ups. By their very nature, the forward-looking statements contained in this news release require Pan Orient and its management to make assumptions that may not materialize or that may not be accurate. The forward-looking information contained in this news release is subject to known and unknown risks and uncertainties and other factors, which could cause actual results, expectations, achievements or performance to differ materially, including without limitation: imprecision of reserve estimates and estimates of recoverable quantities of oil, changes in project schedules, operating and reservoir performance, the effects of weather and climate change, the results of exploration and development drilling and related activities, demand for oil and gas, commercial negotiations, other technical and economic factors or revisions and other factors, many of which are beyond the control of Pan Orient. Although Pan Orient believes that the expectations reflected in its forward-looking statements are reasonable, it can give no assurances that the expectations of any forward-looking statements will prove to be correct.

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Contact Information

  • Pan Orient Energy Corp.
    Jeff Chisholm
    President and CEO
    (403) 294-1770
    Pan Orient Energy Corp.
    Jason Bednar
    Vice President Finance and CFO
    (403) 294-1770