HOUSTON--(BUSINESS WIRE)--BPZ Resources, Inc., d/b/a BPZ Energy (AMEX:BZP), announced the Company has begun oil production at the CX11 platform in the Corvina field of its offshore Block Z-1 in northwest Peru. This early production was initiated pursuant to the Company’s Initial Development Plan that requires the new wells to be put on extended production tests. This will allow the Company to start gathering crucial reservoir data that will be used to optimize the field’s performance.
The Company began producing from the CX11 platform on November 1, 2007 using two 6,000 barrel capacity tankers leased from the Peruvian navy. First production came from the CX11-21XD well, which reached a stabilized rate of 2,500 barrels of oil per day (bopd). The 21XD well was shut after the first tanker was filled with 5,000 barrels of oil and to allow the Company to finish the dual-completion of the recently drilled CX11-14D well. The Company then proceeded to conduct a new gas test by opening the 2 7/8” tubing string used in the dual-completion, allowing the 14D well to reach the maximum design throughput of 28 million cubic feet per day, as expected. Subsequently, the 14D oil tubing string was opened and the 14D flowed at a stabilized rate of 1,900 bopd, producing 5,000 barrels of oil into the second tanker. No formation water was detected in either well.
The two Navy tankers will deliver this first 10,000 barrels of Corvina oil to the Company’s recently refurbished 40,000 barrel transport barge, which will be moored adjacent to Petroperu’s Talara refinery located approximately 70 miles south of the Corvina field. Once the transport barge is filled to near capacity, the oil will be off-loaded into the refinery. The Company expects to receive internationally based spot prices in accordance to the quality of the Corvina oil.
Using the two Navy tankers, the Company expects to achieve average production rates of up to 2,500 bopd. Production is expected to increase to 4,000 bopd by year end or early next year once the FPSO with 40,000 barrel capacity is also placed in service at the platform.
Manolo Zúñiga, President and Chief Executive Officer of BPZ Energy stated, “The accelerated oil production from the Corvina field, and the forthcoming delivery of our first cargo to the Talara refinery, are historical milestones for BPZ. We acted quickly and prudently to establish cash flow before year end.” Mr. Zúñiga continued, “We are planning to increase production step-by-step, first by placing in service the larger FPSO, followed by bringing online our next well, the CX11-18D towards the end of the first quarter of 2008. We have taken our first major step in evolving from a company in development, to an established exploration and production company.”
Frederic Briens, Chief Operating Officer, added, “It is exciting to be able to say that BPZ Energy is now an oil producer. Having both oil wells producing will provide the Company with a tremendous amount of critical reservoir data that will aid with the ongoing reserve certification process, as well as future field development. Furthermore, the dual completion allows the Company to establish the needed feedstock for our proposed gas-to-power project.”
About BPZ Energy
Houston based BPZ Energy, is an oil and gas exploration and production company which has exclusive rights and license agreements for oil and gas exploration and production covering approximately 2.4 million acres in four properties in northwest Peru. It also owns a minority working interest in a producing property in southwest Ecuador. The Company is currently executing an integrated gas-to-power strategy, which includes generation and sale of electric power in Peru and sales of gas into Ecuador for third-party power generation, in parallel with the development of the Corvina oil discovery and the redevelopment of the Albacora oil field. The Company’s website at www.bpzenergy.com provides additional information about the Company’s plans, including photographs and other information with respect to its operations.
Forward Looking Statements
This Press Release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995, Section 27A of the Securities Act of 1933 and Section 27E of the Securities Exchange Act of 1934. These forward looking statements are based on our current expectations about our company, our properties, our estimates of required capital expenditures and our industry. You can identify these forward-looking statements when you see us using words such as "expect," “will”, "anticipate," "estimate," "believes," "plans" and other similar expressions. These forward-looking statements involve risks and uncertainties. Our actual results could differ materially from those anticipated in these forward looking statements. Such uncertainties include the success of our project financing effort, including final documentation and execution of debt financing documents with IFC, accuracy of well test results, well refurbishment efforts, successful production of indicated reserves, and the successful management of our capital development project and other normal business risks. We undertake no obligation to publicly update any forward-looking statements for any reason, even if new information becomes available or other events occur in the future. We caution you not to place undue reliance on those statements.
The U.S. Securities and Exchange Commission permits oil and gas companies, in their filings with the SEC, to disclose only “Proved” reserves that a company has demonstrated by actual production or conclusive formation tests to be economically and legally producible under existing economic and operating conditions. The Company is prohibited from disclosing other categories of reserves in its SEC filings. We use certain terms in this press release such as “tested”, “barrels of oil per day” and “cubic feet of gas” or similar terms suggesting “Indicated” "Probable” or “Possible” oil and gas reserves that the SEC’s guidelines strictly prohibit us from including in filings with the SEC. U.S. investors are urged to consider closely the disclosure in our SEC filings, available from us at 580 Westlake Park Blvd., Suite 525 Houston, Texas 77079; Telephone: (281) 556-6200. You can also obtain these filings from the SEC by calling 1-800-SEC-0330.
Greg Smith, 281-556-6200
Director of Investor Relations and