Suroco Energy Inc.
TSX VENTURE : SRN

Suroco Energy Inc.

September 06, 2011 18:54 ET

Suroco Energy Inc. Announces Results of Poyato-1 Exploration Well in the San Antonio Block in Llanos Basin

CALGARY, ALBERTA--(Marketwire - Sept. 6, 2011) -

NOT FOR DISSEMINATION IN THE UNITED STATES OF AMERICA

Suroco Energy Inc. (TSX VENTURE:SRN) ("Suroco" or the "Corporation") announces that the Poyato-1 exploration well in the San Antonio Block in Colombia has completed drilling and testing and has been temporarily suspended pending further evaluation.

The Poyato-1 well spudded on July 21, 2011, targeting a four way structure mapped on 3D seismic with multiple potential hydrocarbon zones in Eocene and Cretaceous aged formations. Total depth was reached in this vertical well bore at 8,550 feet on August 07, 2011. Crude oil and natural gas shows were encountered while drilling in both the Mirador and Une Formations. Log analysis and Side Wall Cores confirmed the presence of oil in the Mirador formation plus additional potential hydrocarbon zones in the Une and Gacheta Formations were identified via log analysis. The Poyato-1 well was cased and tubing conveyed production testing commenced on August 17, 2011. The first two tests in the Une Formation and Gacheta Formation had no natural flow and ultimately swabbed only fresh water. Two intervals were tested in the Mirador Formation, wherein the lowermost interval had no natural flow and swabbed only fresh water and the upper Mirador interval had no natural flow, but recovered 24.4 barrels of crude oil (19 degree API) and water during 7 hours of swabbing operations. The average basic sediment and water for the Mirador test was 91%.

The Poyato-1 well has been temporarily suspended pending further analysis.

The Corporation's share of costs in the drilling stage of the Poyato-1 well were limited to US$0.5 million under a turn-key agreement with Thorneloe Energy Sucursal Colombia. During the testing stage of the operation the Corporation was responsible for its 28% working interest share. The estimated total costs, net to the Corporation, for drilling and testing the Poyato-1 well are estimated to be approximately US$0.9 million.

Operational Update

The drilling unit that was used to drill the Poyato-1 well will remain on location whilst civil operations continue preparing the access road and surface pad for the next well in the program, the Poyato Sur-1 exploration well. This well is targeting a fault defined closure located approximately 3 kilometres from the Poyato-1 well location. Drilling operations at Poyato Sur-1 are expected to commence in late September or early October. In Poyato Sur-1, the Corporation's share of drilling costs will be limited to US$0.5 million pursuant to the aforementioned turn-key agreement.

As previously announced by the Corporation, the Corporation has exercised its option to acquire a 28% working interest in the San Antonio Block in Colombia. The completion of the acquisition is pending approval from the Agencia Nacional de Hidrocarburos of Colombia, which the Corporation expects to receive in September, 2011.

The Corporation is a Calgary-based junior oil and gas company, which explores for, develops, produces and sells crude oil, natural gas liquids and natural gas in Colombia and Western Canada. The Corporation's common shares trade on the TSX Venture Exchange under the symbol SRN.

Forward Looking Statements

This press release contains forward-looking statements relating to the operational and exploration activities for Suroco, the evaluation of certain prospects in which the Corporation holds an interest, the approval by the Agencia Nacional de Hidrocarburos of Colombia of the acquisition by the Corporation of a 28% working interest in the San Antonio Block in Colombia, and other statements that are not historical facts. Readers are cautioned not to place undue reliance on forward-looking statements, as there can be no assurance that the plans, intentions or expectations upon which they are based will occur. By their nature, forward-looking statements involve numerous assumptions, known and unknown risks and uncertainties, both general and specific, that contribute to the possibility that the predictions, estimates, forecasts, projections and other forward-looking statements will not occur, which may cause actual performance and results in future periods to differ materially from any estimates or projections of future performance or results expressed or implied by such forward-looking statements. These assumptions, risks and uncertainties include, among other things, the state of the economy in general and capital markets in particular; fluctuations in oil prices; the results of exploration and development drilling, recompletions and related activities; changes in environmental and other regulations; risks associated with oil and gas operations and future exploration activities; the need to obtain required approvals from regulatory authorities; and other factors, many of which are beyond the control of the Corporation. You can find an additional discussion of those assumptions, risks and uncertainties in Suroco's Canadian securities filings.

The forward-looking statements contained in this press release are made as of the date of this press release. Except as required by law, Suroco disclaims any intention and assumes no obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise. Additionally, Suroco undertakes no obligation to comment on the expectations of, or statements made by, third parties in respect of the matters discussed above.

Neither TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.

Contact Information

  • Suroco Energy Inc.
    Alastair Hill
    President and Chief Executive Officer
    (403) 232-6784
    (403) 232-6747 (FAX)

    Suroco Energy Inc.
    Travis Doupe
    VP Finance and Chief Financial Officer
    (403) 232-6784
    (403) 232-6747 (FAX)
    www.suroco.com