Touchstone Exploration Inc. has received regulatory approval for the renewal of its East Brighton offshore Exploration and Production License ("License") in the Republic of Trinidad and Tobago. The renewed License is for an initial six-year term, with the option to extend a further twenty-five years upon commercial discovery. The licensed area is a contiguous block of approximately 20,300 acres directly adjacent to the Brighton Marine field, which has produced approximately 60 million barrels of oil to date. The property is divided into two sub-blocks, of which the Company holds a 35% non-operating working interest in Sub-Block A covering approximately 3,000 acres and a 24.5% non-operating interest in Sub-Block B covering approximately 17,300 acres. The acreage resides in the shallow coastal water along the southwest coastline of Trinidad in the Gulf-of-Paria, where water depths average approximately 50 feet.
A successful exploration program was completed in 1999 with two wells drilled, cased, and tested. Both wells tested commercial quantities of oil that resulted in a declaration of commerciality in Sub-Block A, as well as confirming the prospectivity of the overall trend. James Shipka, Vice President, Geosciences said, "The East Brighton property is a significant asset and presents a great opportunity for the Company. The successful testing of PBM 1 and 2 in the developed Nariva sands present in the Brighton Marine field has established East Brighton as an on-trend extension with significant resource potential."
Initial work commitments associated with the License renewal include conducting technical studies and revaluation of existing 3D seismic within two years of the effective date of the renewal, and the drilling of one 5,000 foot exploration well by the end of year three. The Company currently forecasts its share of these commitments to be approximately $3.0 million over the three year period. The commitments are expected to be funded through future cash flows.
Formal signing of the License is expected to take place in Port of Spain, Trinidad prior to the end of February, 2014.