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Toronto, Ontario, Canada -
Candax Energy Inc. ("Candax") [TSX: CAX] is pleased to
announce that rig and specialist drilling management service contracts have
been signed for the implementation of its onshore Tunisian drilling program
in 2008.
Ezzaouia Field (31.4% Working Interest)
The Tunisian national drilling company CTF6 rig is currently being
mobilized from northwest Tunisia to the Ezzaouia field to commence a back
to back, two well campaign to drill Ezzaouia wells 17 and 18. These infill
development wells are targeted at increasing proved reserves and adding
significant production. The wells can be tied into existing facilities and
brought immediately into production upon successful completion. The
Ezzaouia 17 well is due to spud by mid May and is targeting an un-drained,
potentially significant fault block at the east end of the field.
Ezzaouia 18 will be drilled in the west of the field to augment production
in the most prolific fault block yet encountered in the field.
Negotiations are ongoing to procure a rig to undertake a work-over program
on several wells in Ezzaouia, including the Ezzaouia 5 sidetrack, to
further evaluate the potential for bypassed oil in the Cretaceous Zeebag
formation. During 2007, the Ezzaouia partners sidetracked Ezzaouia 10, the
only producing well from the Zeebag, and discovered significant levels of
bypassed oil. Prior to the sidetrack, Ezzaouia 10 was producing about
200 bopd and following the sidetrack, the well initially produced over
2,000 bopd and is still producing at over 400 bopd.
On the Deep Triassic prospect at Ezzaouia, negotiations with all the
partners for drilling are ongoing, and Candax remains fully committed to
reaching an agreement so that an exploration well can be spudded on this
multi-Tcf prospect early in 2009.
Chaal (60% Working Interest)
Following completion of the program at Ezzaouia, the CTF6 rig will be
redeployed to drill the high-angle sidetrack of the Chaal-1 gas discovery
made in 2006. The well is expected to spud in late August or early
September. A contract has been signed with Houston-based NewTech,
drilling specialists with extensive experience in
high-pressure/high-temperature operations. The objective of the Chaal sidetrack is to fully evaluate and
test the commerciality of the gas discovery, and will likely include a
large acid fracturing to optimize flow from the fractured reservoir,
followed by a long term test. On demonstration of commercial flow
rates, the well exposes Candax shareholders to a high-case unrisked Contingent
Resource of 850 Bcf (Ryder-Scott 2007). A two year extension to the Chaal
Exploration Permit has been agreed to, and administrative formalities with
the Tunisian Government initiated, which require no additional work program
commitments beyond the planned sidetrack.
Robbana (80% Working Interest)
Candax is also preparing a program and initiating rig negotiations to
evaluate the significant 3 million barrel Contingent Resource reported
(Ryder-Scott 2008) in the Robbana field through the potential implementation
of water injection. The objective of the program will be to drill an
appraisal/development well down-dip of the producing Robbana-1 well to
assess the extent of the reservoir and effectiveness of augmenting recovery
with water injection. Drilling is expected to commence in the second half
of 2008. Candax also believes that further reserves are present to the west
of Robbana-1, along a structural ridge which extends into the Robbana block
from the recent Mezrane discovery, where oil was tested at the same
stratigraphic level as in Robbana-1. This area will be the focus of a
future exploration/appraisal drilling campaign.
Block 1101 Onshore Madagascar (60% Working Interest)
Following the results from the initial geological fieldwork, geochemistry
and gravity/magnetics have confirmed the excellent potential of Block 1101,
indicating in excess of 5,000 metres of sedimentary section beneath our
block together with numerous oils shows. Candax is currently tendering the
planned 2D seismic program, which is expected to commence in the third
quarter of 2008. Following the encouraging results from initial exploration
studies, planned seismic coverage has been increased to include additional
areas of the Block. Subject to interpretation of the 2D seismic results and
further field work planned for 2008, it is anticipated that the first
exploration well will be drilled in 2009.
Michael Wood, President & CEO, commented:
"As the El Bibane project nears completion with the on-going tie-in of
El Bibane 3 and production optimization of El Bibane 4, Candax is about to
commence a significant onshore development and appraisal drilling program.
Our objectives are to maximize our onshore oil production and to appraise
the high impact potential of both the Chaal and Robbana projects. In
the second half of 2008, the sidetrack of Chaal-1 will appraise the
commercial viability of an 850 Bcf identified resource, and the downdip
Robbana well will test the potential to add significant reserves through
water injection. We are also making significant progress on our other
high impact exploration projects in Tunisia, Madagascar and
elsewhere. The Candax team is excited about results to date, and
remains focused to maintain the momentum established so far this year to
ensure further increases in net oil production are brought on-stream and to
use the drill-bit to access some of the world class potential in our
exploration/appraisal portfolio."
Candax Energy Inc. is an international energy company with its head office
in Toronto, Ontario, Canada and management offices in London, Dubai and
Tunis. The Company holds a number of concessions in Tunisia through its
subsidiary companies and is involved in the exploration and production of
oil, gas and power generation in the country. Candax was formed
through the combination of a highly experienced executive management team
with successful Canadian founders and financiers, to develop an
international upstream oil and gas project portfolio. Candax is initially
focusing its growth activities on production and development projects in
the Middle East and North Africa, where the group has strong relationships
as well as extensive management experience.
NOTE: To view the photograph associated with this press release, please click here.
This press release includes "forward looking statements",
within the meaning of applicable securities legislation, which are based on
the opinions and estimates of Management and are subject to a variety of
risks and uncertainties and other factors that could cause actual events or
results to differ materially from those projected in the forward looking
statements. Forward-looking statements are often, but not always,
identified by the use of words such as "seek",
"anticipate", "budget", "plan",
"continue", "estimate", "expect",
"forecast", "may", "will",
"project", "predict", "potential",
"targeting", "intend", "could",
"might", "should", "believe" and similar
words suggesting future outcomes or statements regarding an outlook. Such
risks and uncertainties include, but are not limited to, risks associated
with the oil and gas industry (including operational risks in exploration
development and production; delays or changes in 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; the uncertainty
surrounding the ability of Candax Energy Inc. to obtain all permits,
consents or authorizations required for its operations and activities; and
health safety and environmental risks), the risk of commodity price and
foreign exchange rate fluctuations, the ability of Candax Energy Inc. to
fund the capital and operating expenses necessary to achieve the business
objectives of Candax Energy Inc., the uncertainty associated with
commercial negotiations and negotiating with foreign governments and risks
associated with international business activities, as well as those risks
described in public disclosure documents filed by Candax Energy Inc. Due to
the risks, uncertainties and assumptions inherent in forward-looking
statements, prospective investors in securities of Candax Energy Inc.
should not place undue reliance on these forward-looking statements.
Statements in relation to "reserves" are deemed to be forward-looking
statements, as they involve the implied assessment, based on certain
estimates and assumptions, that the reserves described can be profitably
produced in the future.
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