TSXV Trading Symbol: MVN
CALGARY, Nov. 12, 2013 /CNW/ - Madalena Energy Inc. (TSXV:
MVN) (the "Company" or "Madalena") is pleased to provide the
following update:
Domestic Update: West-Central Alberta
The Company is pleased to report that its most
recent 100% working interest ("W.I.") horizontal Ostracod oil well
located at 1-32-55-7W5M in the Paddle River area of west-central
Alberta commenced production in
early November 2013. During its
initial nine operating days of production the well flowed at an
average rate of 658 bbls/d of 30° API oil and 871 mscf/d of raw
natural gas for a total of 803 barrels of oil equivalent ("boe")
per day ("boe/d") (82% oil). After accounting for shrinkage and
NGLs recovery at the local production facility, the average rate
over the initial nine operating days would equate to approximately
793 boe/d (87% oil & NGLs). This well was drilled to a total
depth of 3,250 metres with a horizontal length of 1,380 metres and
was completed with a 16 stage multi-frac program.
International Update: Neuquén Basin
Coiron Amargo Block - Southern Extension
Approved and Drilling Update
The Coiron Amargo block (35% W.I.) held by
Madalena is divided into two regions called Coiron Amargo Norte
(northern portion of the block) and Coiron Amargo Sur (southern
portion of the block). Coiron Amargo Norte is currently under
a 25 year exploitation (development) concession which was approved
by the Province of Neuquén in 2012. Following an application
and approval process by Madalena and its partners over the past
several months, the exploration period for Coiron Amargo Sur has
now been extended by way of an official decree signed by the
Province of Neuquén in Argentina. This one year extension until
November 8, 2014 provides Madalena
with the financial flexibility to satisfy the remaining work
commitments on the block, versus the previous deadline of
November 7, 2013. The remaining
work commitments in Coiron Amargo Sur are estimated at
approximately USD$ 3.8 million plus
VAT (net to Madalena) as of June 30,
2013. After satisfying these remaining work
commitments, Madalena has the ability to extend Coiron Amargo Sur
through further exploration, evaluation and/or exploitation
(development) phases.
The CAN.XR-2(H) well was recently re-entered and
is currently being drilled horizontally in the Sierras Blancas
light oil reservoir. This well represents the first horizontal well
drilled into one of the six Sierras Blancas conventional light oil
pools discovered on the block to date. Subsequent to this well, the
Company plans to drill an additional Vaca Muerta shale delineation
well (CAS.x-15) in the southern portion of the block.
Curamhuele Block Update
The Company continues to work towards a joint
venture to accelerate exploration and development activities on its
90% W.I. Curamhuele block. RBC Capital Markets ("RBC"), Madalena's
exclusive advisor related to its Neuquen basin assets, is in
communication with a broad spectrum of parties to solicit interest
in a joint venture or other transaction with the Company. The
Company cautions that there are no assurances that an acceptable
joint venture arrangement or other transaction will be reached.
The key zones across the block are the
unconventional Vaca Muerta shale, Lower Agrio shale, and
Mulichinco, as well as other conventional formations of
interest.
About Madalena - International and Domestic Assets
Madalena is an independent, Canadian-based,
domestic and international upstream oil and gas company whose main
business activities include exploration, development and production
of crude oil, natural gas liquids and natural gas.
Internationally, Madalena holds three large
blocks within the Neuquén basin in Argentina where it is focused on the
delineation of large petroleum in-place shale and unconventional
resources in the Vaca Muerta and Lower Agrio shales, in addition to
tight sand plays in the Mulichinco and Quintuco. The Company is
also developing a conventional oil play in the Sierras Blancas
formation. Madalena holds 135,000 net acres on the Coiron Amargo
(35,027 net acres), Curamhuele (50,400 net acres) and Cortadera
(49,600 net acres) blocks.
Domestically, Madalena's core area of operations
is located in the Greater Paddle River area of west-central
Alberta where the Company holds
approximately 200 gross (>150 net) sections of land (78% average
W.I.) encompassing light oil and liquids-rich gas resource plays.
Madalena's primary domestic focus is to exploit its large inventory
of horizontal drilling locations on its Ostracod oil and emerging
Nordegg oil & liquids-rich gas
resource plays.
Madalena trades on the TSX Venture Exchange
under the symbol MVN. Basic corporate information, recent news
releases and regularly updated corporate presentations are
available on the Company's website at
www.madalena-energy.com.
Reader Advisories
Forward Looking Information
The information in this news release contains
certain forward-looking statements. These statements relate to
future events or our future performance, in particular with respect
to the Company's reserves and production from its properties. All
statements other than statements of historical fact may be
forward-looking statements. Forward-looking statements are often,
but not always, identified by the use of words such as "seek",
"anticipate", "plan", "continue", "estimate", "approximate",
"expect", "may", "will", "project", "predict", "potential",
"targeting", "intend", "could", "might", "should", "believe",
"would" and similar expressions. In particular, this news release
contains forward-looking statements pertaining to planned
operational activities to be conducted by the Company. In addition,
statements relating to "reserves" or "resources" are deemed to be
forward-looking statements as they involve the implied assessment,
based on certain estimates and assumptions, that the reserves and
resources described exist in the quantities predicted or estimated
and can be profitably produced in the future. These statements
involve substantial known and unknown risks and uncertainties,
certain of which are beyond the Company's control, including: the
impact of general economic conditions; industry conditions; changes
in laws and regulations including the adoption of new environmental
laws and regulations and changes in how they are interpreted and
enforced; fluctuations in commodity prices and foreign exchange and
interest rates; stock market volatility and market valuations;
volatility in market prices for oil and natural gas; liabilities
inherent in oil and natural gas operations; uncertainties
associated with estimating oil and natural gas reserves;
competition for, among other things, capital, acquisitions, of
reserves, undeveloped lands and skilled personnel; incorrect
assessments of the value of acquisitions; changes in income tax
laws or changes in tax laws and incentive programs relating to the
oil and gas industry; geological, technical, drilling and
processing problems and other difficulties in producing petroleum
reserves; and obtaining required approvals of regulatory
authorities. The Company's actual results, performance or
achievement could differ materially from those expressed in, or
implied by, such forward-looking statements and, accordingly, no
assurances can be given that any of the events anticipated by the
forward-looking statements will transpire or occur or, if any of
them do, what benefits the Company will derive from them. These
statements are subject to certain risks and uncertainties and may
be based on assumptions that could cause actual results to differ
materially from those anticipated or implied in the forward-looking
statements. The forward-looking statements in this news release are
expressly qualified in their entirety by this cautionary statement.
Except as required by law, the Company undertakes no obligation to
publicly update or revise any forward-looking statements. Investors
are encouraged to review and consider the additional risk factors
set forth in the Company's Annual Information Form, which is
available on SEDAR at www.sedar.com.
Oil and Gas Disclosure
Any references in this news release to test
rates, flow rates, initial and/or final raw test or production
rates, early production, test volumes behind pipe and/or "flush"
production rates are useful in confirming the presence of
hydrocarbons, however, such rates are not necessarily indicative of
long-term performance or of ultimate recovery. In addition, the
Company's Ostracod project is a resource project, like many other
projects where operators deploy similar operational approaches to
those utilized by the Company, and may be subject to high initial
decline rates of production and pressure. Such production rates may
also include recovered "load" fluids used in well completion
stimulation. Readers are cautioned: (a) not to place reliance on
such rates in calculating the aggregate production for Madalena;
and (b) test or early production results are not necessarily
indicative of long-term performance or of ultimate recovery.
All calculations converting natural gas to
barrels of oil equivalent ("boe") have been made using a conversion
ratio of six thousand cubic feet (six "Mcf") of natural gas to one
barrel of oil, unless otherwise stated. The use of boe may be
misleading, particularly if used in isolation, as the conversion
ratio of six Mcf of natural gas to one barrel of oil is based on an
energy equivalency conversion method primarily applicable at the
burner tip and does not represent a value equivalency at the
wellhead. Given that the value ratio based on the current price of
crude oil as compared to natural gas is significantly different
from the energy equivalency of 6:1, utilizing a conversion on a 6:1
basis may be misleading as an indication of value.
Neither the TSX Venture Exchange nor its Regulation Service
Provider (as that term is defined in the policies of the TSX
Venture Exchange) accepts responsibility for the adequacy or
accuracy of this release.
SOURCE Madalena Energy Inc.