Americas Petrogas (Americas Petrogas or the Company) is pleased to provide an update on its activities in Argentina and Peru.
Argentina
Conventional Light Oil
For the third quarter of 2012, Americas Petrogas has continued to increase production and sell oil from two of its conventional blocks, Medanito Sur and Rinconada Norte, both operated by the Company. Production for the third quarter averaged approximately 2200 bopd (net), an increase of approximately 49% over the average daily production during the second quarter of 2012. During October 2012, average production exceeded 3,000 bopd (net) representing an increase of approximately 36% over the average daily production during the third quarter.
Construction of the Company’s own production/processing facilities to handle up to 6300 bopd of gross production is continuing and is expected to be completed before the end of 2012.
Unconventional Shale Oil and Gas
- On the Totoral block (Americas Petrogas – 90% working interest and operator), the Company has completed all logistics and is about to perform an hydraulic fracture stimulation (“frac”) program, followed by testing of the La Hoya well, LHo.x-1, which completed drilling in July 2012. The Totoral block is located at the southern region of the Neuquen Basin where the Company has identified the Vaca Muerta at a much shallower depth compared to other parts of the Basin.
- On the Los Toldos II block (Americas Petrogas – 45% working interest and operator), the Los Toldos Este well, LTE.x-1, which completed drilling earlier in 2012 and completed fracing in September, continues to be flow tested.
- On the Los Toldos II block, the Aguada de Afuera well, ADA.x-1, which was spud in early October 2012 continues to be drilled and is currently at a depth of approximately 2,750 metres (9,022 feet) with a projected total depth of 3,350 metres (10,990 feet).
- On the Los Toldos I block (Americas Petrogas – 45% working interest and operator), drilling of the ALL.x-1 well was completed in September 2012 and analysis of the cores and cuttings is underway and leading towards developing a plan for future completion and testing.
- On the Huacalera block (Americas Petrogas -- 39% working interest and operated by Apache), the Hua.x-1 well, which completed drilling in the third quarter of 2011, is being prepared for a second frac in another zone of the Vaca Muerta formation.
Peru
GrowMax Agri Corp., owned 80% by the Company, continues to advance on its potash and phosphates projects in Peru through its Peruvian subsidiary, Americas Potash Peru SA. Recently, Americas Potash Peru acquired an additional approximately 10,000 hectares of concession lands in the Sechura Desert with potential for phosphates and other minerals. These additional lands are located directly North of lands recently acquired by Vale SA. Separately from these newly-acquired lands, in 2011, Vale SA, in joint venture with Mitsui & Co. and Mosaic Company, put into production a 3.9 million tonne (capacity) per year surface phosphate mine nearby Americas Potash Peru’s concessions. Golder Associates Ltd. in Peru has been engaged to assist Americas Potash Peru towards completion of a resources report for phosphates.
Ercosplan, Americas Potash Peru’s consultant responsible for completing a Potash resources report, continues to advance and expects completion of the report before the end of 2012.
Mr. Barclay Hambrook, President and CEO of Americas Petrogas said, “We continue to execute on our immediate, medium-term and long-term plans to grow our oil production, reserves and resources, de-risk our shale oil and gas blocks as well as adding value to our potash and phosphate projects in Peru.”
