Petrolifera Petroleum Limited
January 15, 2008
TSX: PDP
Petrolifera
confirms activation of Puesto Morales North waterflood; provides salient
details
CALGARY - Petrolifera Petroleum Limited confirmed
today that its waterflood pressure maintenance project at Puesto Morales North
in the Neuqu�n Basin, Rio Negro Province, onshore Argentina commenced
continuous operations on January 11, 2008, following a period of commissioning
and line testing which started in late December, 2007.
The purpose of the project is to enhance reservoir
pressure in the prolific and high quality Jurassic Sierras Blancas oil-bearing
reservoir at Puesto Morales. It is anticipated that there will be a period of
approximately six months of water injection before meaningful response will be
discernible in overall crude oil production levels and that it will take
approximately eighteen months from startup of injection to achieve optimum
production response, based on initial simulation studies of the reservoir. The
high quality reservoir, characterized by excellent porosities and significant
measured permeability, should facilitate excellent transmissibility of fluid
and the project is expected to have a material and favorable impact on the
ultimate recovery factor for the field.
The first injection stage in the Sierras Blancas
formation will occur in 2008 and is expected to reach a total water injection
rate of 18,000 barrels of water per day with approximately thirteen injector
wells, including new wells and conversions. Future waterflood developments and
optimizations will increase the injection rate to the capacity of 25,000
barrels of water per day.
The water injection plant is now operating with
initial injection of approximately 5,000 barrels of water per day in four
wells, PMN-1025, PMN-1011 and PMN-1037 in the northern part of the field and
PMN-1035 in the central portion of the field. Over time, additional injectors
will be tied back to the plant to realize the final injection rate of
approximately 25,000 barrels of water per day. Fresh water is supplied to
Petrolifera's water treatment plant, situated in the northern portion of the
field, through a six kilometer ten-inch pipeline from facilities situated near
the Casa de Piedra dam on the Rio Colorado River, resulting in the reservoir or
embalse in the region.
Petrolifera's Puesto Morales water treatment plant
filters the water with a targeted efficiency exceeding 90 percent on particle
sizes exceeding five microns. Also, a target of 90 percent efficiency in oxygen removal is
anticipated.
The
activation of the water injection plant is a significant milestone for
Petrolifera. It was constructed against a backdrop of energy and equipment
shortages in Argentina
and its completion is a credit to the company's operational staff and external
advisors and consultants. More importantly, it is anticipated the waterflood
will consequentially impact on Petrolifera's light crude oil production in Argentina
during 2008 and beyond.
Petrolifera
is a Calgary-based crude oil and natural gas exploration, development and
production company with activities in Argentina,
Peru and Colombia.
The company has branch offices in Buenos Aires, Argentina;
Bogota, Colombia
and Lima, Peru.
Its common shares are listed for trading on the Toronto Stock Exchange under
the symbol PDP. There are presently 50.1 million common shares outstanding
(54.4 million fully-diluted). The company's growth from a modest startup base
in late 2005 when it went public has been organic, through successful drilling
programs in Argentina.
Since that time the company has expanded into both Colombia
and Peru,
and controls approximately 6.5 million net acres of exploration and production
rights in these three South American countries. Petrolifera operates with a
very small head office staff of three full-time professionals, two part-time
individuals and solely employs nationals in all of its foreign offices. The
company prides itself on its efficiency of operations, low finding and
development and on stream costs, low operating costs and its efficient use of
capital.
Forward-Looking Information
This press release contains
forward-looking information, included but not limited to anticipated results of
Petrolifera's waterflood pressure maintenance project and its potential impact
on future production levels. This forward looking information is not based on
historical facts but rather on Management's expectations regarding the
performance of the waterflood plant and facilities and reservoir
characteristics. Such forward looking information reflects Management's current
beliefs and assumptions and is based on information currently available to
Management. Forward looking information involves significant known and unknown
risks and uncertainties. A number of factors could cause actual results to
differ materially from the results discussed in the forward looking
information, including but not limited to, risks associated with the oil and
gas industry (e.g. operational risks in development, exploration and
production, delays or changes to plans with respect to exploration or
development projects or capital expenditures; the uncertainty of reserve
estimates; the uncertainty of estimates and projections in relation to
production, costs and expenses and health, safety and environment risks), the risk
of commodity price and foreign exchange rate fluctuations, the uncertainty
associated with negotiating with foreign governments and third parties located
in foreign jurisdictions and the risk associated with international activity.
Additional risks and uncertainties are described in the company's Annual
Information Form which is filed on SEDAR at www.sedar.com. The company's
ability to increase sales of crude oil and natural gas is dependent upon
sustained productivity of new and existing wells and results of its water flood
and water injection program. Although the forward looking information contained
herein is based upon assumptions which Management believes to be reasonable,
the company cannot assure investors that actual results will be consistent with
this forward looking information. This forward looking information is made as
of the date hereof and the company assumes no obligation to update or revise
this information to reflect new events or circumstances, except as required by
law. Because of the risks, uncertainties and assumptions inherent in forward
looking information, prospective investors in the company's securities should
not place undue reliance on this forward looking information.
For further
information:
Richard A Gusella
Executive Chairman
Petrolifera Petroleum Limited
Phone: (403) 538-6202
Fax: (403)
538-6225
inquiries@petrolifera.ca
www.petrolifera.ca
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