CALGARY, AB, Dec. 3, 2020 /CNW/ - Touchstone Exploration Inc.
("Touchstone", "we", "our", "us" or the "Company") (TSX: TXP)
(LSE: TXP) reports that the Company has completed drilling the
Cascadura Deep-1 exploration well on the Ortoire exploration block,
onshore in the Republic of Trinidad and
Tobago (Touchstone 80% working interest operator, Heritage
Petroleum Company Limited 20% working interest) and is pleased to
announce that the well encountered significant hydrocarbon
accumulations based on drilling and wireline log data.
Highlights
- Cascadura Deep-1 was drilled to a total depth of 8,303 feet.
Drilling was suspended prior to the planned total depth of 10,600
feet due to high pressure gas zones encountered while
drilling.
- The well encountered total sand thickness of 2,100 feet in
multiple, stacked thrust sheets in the Herrera section.
- Wireline logs indicated natural gas pay totaling approximately
1,315 net feet in four unique thrust sheets in the Herrera sands
from a depth of 5,455 feet to total depth.
- An aggregate 1,007 net feet of natural gas pay was identified
in the overthrust sheets, an increase of approximately 20 percent
compared to the Cascadura-1ST1 discovery.
- Additional natural gas pay of approximately 308 net feet was
encountered in two previously untested Herrera thrust sheets below
the sands observed in the Cascadura-1ST1 well.
Paul R. Baay, President and
Chief Executive Officer, commented:
"I am pleased that the Ortoire block continues to outperform
our expectations. The Cascadura Deep-1 well is the best well we
have drilled on the Ortoire property to date and it has provided
three key pieces of information, primarily that the Cascadura field
has numerous targets with each one of the thrust sheets providing
its own unique opportunity. It has also shown that the system is
hydrocarbon charged and that in time we will require more drilling
horsepower to evaluate the deeper zones. We now have a unique
opportunity to design a development drilling program in the area
and expand our exploration program while we complete and tie-in the
existing Cascadura and Chinook wells. The time required to
undertake this will allow us to secure additional equipment and
submit a full field development plan to proceed with a continual
drilling program. As we move into 2021, Touchstone is entering a
new phase that will see rapid production growth along with a
balanced portfolio of development and exploration
opportunities."
The Cascadura Deep-1 well was drilled to a total measured depth
of 8,303 feet (true vertical depth of 8,133 feet) on November 30, 2020. While the well was originally
planned to be drilled to a total depth of 10,600 feet, the gas
sands encountered in overthrust Sheet 4 proved difficult to manage,
and the decision was made to cease drilling to preserve the
substantial pay section encountered in the well.
Drilling samples and open hole wireline logs indicated that the
well encountered a significant Herrera turbidite package with a
total thickness of over 2,900 feet containing in excess of 2,100
feet of sand, with an aggregate 1,315 net feet of natural gas pay
in four unique thrust sheets.
The well encountered 558 net feet of hydrocarbon pay in the
Gr7bc section of the overthrust Herrera sands at measured depths
between 5,450 and 6,050 feet. These sands, locally referred to as
the Sheet 3 overthrust sands, correlate to the sands discovered and
tested at Cascadura-1ST1 at depths between 5,516 and 6,162 feet.
The gross section encountered in Cascadura Deep-1 was 20 feet less
than observed in Cascadura-1ST1 which is located approximately 900
feet to the northwest.
The well encountered 449 net feet of hydrocarbon pay in the
Gr7abc section of Sheet 4 of the overthrust Herrera sands at
measured depths between 6,050 and 6,532 feet. These sands correlate
to the lower sands discovered and tested in Cascadura-1ST1 at
depths between 6,162 and 6,350 feet. The gross Sheet 4 section
encountered at Cascadura Deep-1 is more than 245 feet thicker than
sands observed in the Cascadura-1ST1 well and is consistent with
the Company's models based on seismic data.
The intermediate Gr7bc sands were the Company's primary target
originally identified in the offsetting BW-5 well. 308 net feet of
hydrocarbon pay was identified in two thrust sheets within the
Gr7bc section of the intermediate Herrera sands at measured depths
between 7,086 and 8,246 feet. The sands encountered in one of these
thrust sheets correlate to the offsetting BW-5 well while the other
thrust sheet was not encountered in the offsetting well; neither
thrust sheet has been previously tested.
James Shipka, Chief Operating
Officer, stated:
"The Cascadura structure continues to exceed our
expectations, and the Cascadura Deep-1 exploration well confirms
that this is a unique structure with tremendous potential. Although
we were unable to drill to our planned total depth, the information
gathered while drilling and the hydrocarbon accumulations
encountered are truly exceptional. Not only did we encounter a
massive section of turbidite deposits nearly 3,000 feet thick, we
established the intermediate thrust sheet as a viable reservoir and
expanded the known boundaries of the sands tested in the
Cascadura-1ST1 well. In the intermediate section, wireline data
identified in excess of 300 feet of prospective pay in two thrust
sheets, one of which has not been previously encountered in the
area. While those 308 feet of sand met the threshold for pay based
on log data, wellsite sampling saw hydrocarbon indicators
throughout the entire section which we aim to gain a better
understanding of through our production testing program. In the
sands previously evaluated in Cascadura-1ST1, we were able to not
only confirm the continuity of the structure, we were able to
identify the base of the sand package at nearly 200 feet below the
total depth of the original well. Finally, the information obtained
at Cascadura Deep-1 provides great insight into what was observed
at the Chinook-1 well which the Company expects to commence
production testing later this month."
The Cascadura Deep-1 exploration well was spud on October 27, 2020 using Well Services Petroleum
Ltd. Rig #80. The well was designed to explore the potential of a
thick sequence of Herrera sandstones contained in a series of
thrust sheets which were observed in the offsetting BW-5 well as
well as the recent Cascadura-1ST1 and Chinook-1 discoveries. The
primary target of the Cascadura Deep-1 well were the Gr7bc Herrera
sands in the intermediate thrust sheet at an approximate measured
depth of 7,600 feet. These sands were interpreted to correlate to,
but separate from, the sands observed in the Company's Chinook-1
discovery. The well was intended to further evaluate a secondary
target of a repeated section of Gr7bc Herrera sands in a subthrust
sheet from approximately 9,500 feet to a planned total depth of
10,600 feet.
The Cascadura Deep-1 well is the fourth of the amended five well
exploration commitment under Touchstone's Ortoire Exploration and
Production Licence. The Company has an 80% working interest in the
licence but is responsible for 100% of the drilling, completion and
testing costs associated with the initial five exploration wells.
Heritage Petroleum Company Limited holds the remaining 20% working
interest. Touchstone had no reserves booked for the Cascadura
Deep-1 well in the Company's December 31,
2019 independent reserves report. Further testing is
required to determine the economic viability and potential of the
well, and the Company plans to commence completion and production
testing operations during the first quarter of 2021.
Term Loan Amendment
On November 27, 2020, the Company
and its lender executed an amending agreement to the Loan
Agreement, allowing the Company to repay $7.5 million of the current $15 million term loan balance on December 15, 2020 to reduce interest costs. Upon
repayment, the available credit capacity of $12.5 million may be drawn by the Company at any
time prior to June 15, 2021.
Touchstone Exploration Inc.
Touchstone Exploration Inc. is a Calgary, Alberta based company engaged in the
business of acquiring interests in petroleum and natural gas rights
and the exploration, development, production and sale of petroleum
and natural gas. Touchstone is currently active in onshore
properties located in the Republic of Trinidad and Tobago. The Company's common
shares are traded on the Toronto Stock Exchange and the AIM market
of the London Stock Exchange under the symbol "TXP".
Advisories
Forward-Looking Statements
Certain information provided in this news release may constitute
forward-looking statements and information (collectively,
"forward-looking statements") within the meaning of applicable
securities laws. Such forward-looking statements include, without
limitation, forecasts, estimates, expectations and objectives for
future operations that are subject to assumptions, risks and
uncertainties, many of which are beyond the control of the Company.
Forward-looking statements are statements that are not historical
facts and are generally, but not always, identified by the words
"expects", "plans", "anticipates", "believes", "intends",
"estimates", "projects", "potential" and similar expressions, or
are events or conditions that "will", "would", "may", "could" or
"should" occur or be achieved.
Forward-looking statements in this news release may include, but
is not limited to, statements relating to the quality and quantity
of prospective hydrocarbon accumulations based on wireline logs,
including the Company's interpretations thereof; and the Company's
exploration plans and strategies, including anticipated drilling,
timing, production testing, development, tie-in, facilities
construction, and ultimate production from exploration and
development wells. Although the Company believes that the
expectations and assumptions on which the forward-looking
statements are based are reasonable, undue reliance should not be
placed on the forward-looking statements because the Company can
give no assurance that they will prove to be correct. Since
forward-looking statements address future events and conditions, by
their very nature they involve inherent risks and uncertainties.
Actual results could differ materially from those currently
anticipated due to a number of factors and risks. Certain of these
risks are set out in more detail in the Company's 2019 Annual
Information Form dated March 25, 2020
which has been filed on SEDAR and can be accessed at www.sedar.com.
The forward-looking statements contained in this news release are
made as of the date hereof, and except as may be required by
applicable securities laws, the Company assumes no obligation to
update publicly or revise any forward-looking statements made
herein or otherwise, whether as a result of new information, future
events or otherwise.
SOURCE Touchstone Exploration Inc.