Condor provides an operations update
CALGARY, October 26, 2015 – Condor Petroleum Inc. (“Condor” or the “Company”) (TSX:CPI) is pleased to provide an operations update for the Company’s 100% owned Zharkamys West 1 Territory in Kazakhstan.
The KN‐501 Primary Basin well was drilled to 3,992 meters and has been abandoned. After accruing for the total estimated well costs of CA$7.7 million, the Company has estimated working capital of CA$46 million and no debt.
Despite encountering numerous gas shows while drilling the over‐pressured main hole section, no commercial hydrocarbon reservoirs were identified. It appears that the target zones were fully encapsulated in salt before younger, coarser‐grained sediments were deposited. This resulted in a lack of reservoir quality rock like that which was encountered in the Company’s play opening KN‐E Primary Basin discovery.
Using KN‐501 data, the Company’s high resolution 3D seismic has been calibrated to the geological age of Primary Basin sediments. This is extremely beneficial in helping to identify potential reservoir quality rock in the extensive Primary Basin inventory. KN‐501 has also confirmed that hydrocarbon source, migration, trap and seal are present in this region and that the Company’s geologic model is able to accurately predict sedimentary packages within salt. The Company is currently prioritizing the Primary Basin inventory with the newly calibrated 3D seismic data and applying the KN‐501 and KN‐E seismic interpretation learnings to mature drill‐ready targets for 2016.
The recent Primary Basin geological and operations learnings are also being applied to the Company’s deeper Pre‐Salt prospect inventory. The geologic model validation from KN‐501 now provides a high degree of confidence in predicting structures within the Pre‐Salt. The seismic responses within the Primary Basin also confirm the ability to seismically predict the Pre‐Salt geology, which is key to further developing this play type. Pre‐Salt well cost estimates of CA$21 to CA$25 million for a 6,500 meter well are considerably less than prior estimates given the knowledge gained while drilling KN‐501’s massive salt section and highly over‐pressured formations. The Company is discussing Pre‐Salt farm‐down alternatives.
Kazakhstan Government approvals of the Shoba and Taskuduk West commercial production contracts are expected in Q1 2016. Production facilities are operational and, once the production contracts have been received, the Company’s production will re‐commence along with access to export oil sales markets and pricing. The approval timeline was extended to 2016 given the low commodity prices of 2015.