Pacific Rubiales Announces Update of the Resource Assessment for its Exploration Blocks in Colombia, Peru and Guatemala

TORONTO, Oct. 21, 2011 /PRNewswire/ - Pacific Rubiales Energy Corp. (TSX: PRE; BVC: PREC) announced today that it has received independent resource assessment reports for the Company's exploration blocks in Colombia, Peru and Guatemala. As a result of the resource reports, a total best estimate ("P50") of 398.65 MMboe of Prospective Resources (Prospects), 2,375.07 MMboe of Prospective Resources (Leads), 3.73 MMboe of Contingent Resources for a Total Resources of 2,777.45 MMboe.

The applicable resource assessment report was prepared by Petrotech Engineering Ltd. ("Petrotech") using an effective date of June 30, 2011 with a view to estimating the potential undiscovered oil and gas resources in the 25 exploration blocks in which the Company holds interests, for a total of 4,960,651 net hectares.  The resource assessment report includes 21 of the Company's 34 blocks in Colombia: Llanos (9), Lower Magdalena Valley (5), Cesar- Rancheria (1), Upper Magdalena Valley (2) and Putumayo (4).  In addition, there are three blocks located in the Maranon and Ucayali Basins of Peru and one block in Guatemala.  It is worth noting that the reports do not include estimated resources for the CPE-1, Caguan-5, Cordillera-15 and Cordillera-24 technical evaluation agreement ("TEA") contracts. Once these TEA contracts become E&P contracts, they will be included within the yearly updates for resource certifications.  In addition, the resources in CPE-6 Block have been evaluated by Petrotech with an effective date of September 30, 2011. In the case of Blocks 135 and 137 in Peru, the Prospective Resources are based on an assessment report provided by Petrotech in 2007. The gross Company's share of the unrisked Prospective Resources (Leads) in the best estimate is 168.91 MMbbl of heavy oil.

The Company holds a 49.999% equity participation in Maurel & Prom Colombia B.V. ("MPC").  This news release includes data referring to blocks CPO-17 and SSJN-9 where MPC holds a 50% interest and to blocks CORDILLERA 15 and Sabanero where MPC holds a 100% interest. The information regarding the Topoyaco Block is subject to receiving regulatory approval on the transfer of the interests in such block to the Company.

Notes:
(1)     Numbers may not add due to rounding up.
(2)     BOE conversion is 5.7 Mcf per barrel using the Colombian standard.

The Petrotech resource estimates were prepared in accordance with the requirements of Canadian National Instrument 51-101 - Standards of Disclosure for Oil and Gas Activities. Capitalized terms related to resource classifications used in this press release are based on the definitions and guidelines in the Canadian Oil and Gas Evaluation Handbook ("COGEH").

Ronald Pantin, Chief Executive Officer of the Company, commented: "The certified resources update that we are pleased to make public today underlines the prospectivity of our exploration portfolio and serves, together with 2P reserves we have already reported, as the foundation on which we will keep building our future growth."

COLOMBIA

Llanos Basin

A best estimate of 1,365 MMbbls of total gross Prospective Resources has been assigned to 1,409,703 hectares for 9 blocks: Quifa, Sabanero; CPE-6, CPO-1, CPO-12, CPO-14, CPO-17, Arauca and Arrendajo Blocks.  The resource evaluation was made on the identified prospects and/or leads for each block, and was based on available seismic and well data. A prospect was considered when it is traversed with two or more separate 2-D seismic lines, or when it is covered with 3D seismic. Lead evaluation was based on areas where seismic data is very scarce or it requires additional information.

The following table summarizes the oil Prospective Resources for the identified prospects /leads for each block in the Llanos Basin:

Note: The Company's interest in the Sabanero Block is an indirect interest.

Quifa

In the Quifa Block, five prospects have been identified in the northern and eastern part of the Quifa Block: "A", "F", "Q", "P" and "Z".   The traps for these prospects represent structural closures against antithetic faults.  Although the structural pattern control is the main trap mechanism, stratigraphic traps are also present and are one of the most important features for reservoir continuity. Resources for prospects "A", "F" and "Q", have been estimated as remaining resources after the certification for the 2P reserves.

The following table summarizes the oil Prospective Resources for each of the five prospects in the Quifa Block, as well as the chance of success for each one:

Sabanero

In the Sabanero Block, two prospects and four leads have been identified. The Sabanero and Sabanero South figures are remaining resources after the 100% 2P reserves reported by the Company; 31.4 MMbbl on October 3, 2011. The four leads that have been identified are based in few available seismic lines, and basically the trap concept corresponds to the same structural pattern reported in the Quifa Block. 

The table below shows resource estimate for the Sabanero opportunities and their chance of success:

CPE-6

The CPE-6 E&P Block is a new contract granted to the Company by the ANH. In the block, and based on the interpretation of 636 km of 2D seismic data and on the results from 10 previously drilled wells, one lead has been identified, and represents a stratigraphic trap developed by a pinch out of Tertiary sediments against the Paleozoic basement.  The estimated resources for the "Hamaca" lead are summarized below:

CPO-1

Three leads have been identified in the CPO-1 Block after the interpretation of 208 km of existing 2D seismic. These leads show exploration opportunities in the C-3, C-5 and C-7 Units of the Tertiary Carbonera Formation, and correspond mainly to structural traps. The following table summarizes the estimated resources for each lead:

CPO-12

In the CPO-12 Block, ten exploration leads have been identified through the interpretation of 417 km of existing 2D seismic acquired during 2010.  These leads are looking for structural traps in the Tertiary Carbonera Formation. A summary of the estimated resources is presented below:

CPO-14

In the CPO-14 Block, seven leads have been identified from the available seismic. These leads are looking for structural traps in the Tertiary Carbonera Formation similar to the Rubiales and Quifa Blocks.  A summary of the estimated resources is presented below:

CPO-17

Four leads have been identified in the CPO-17 Block from the available seismic and well data. Analogous to the CPE-6 Block, these leads are looking for stratigraphic traps associated to pinch outs of Tertiary sediments. The summary of the resource estimates for the four leads and the chance of success are shown in the table below:

Note: The Merlin Prospective Resource contains contingent resources.

Arauca

In the Arauca Block, two prospects have been defined: the "AK-1" prospect, defined on a structural horst at basal unconformity level, as a normal structural trap defined in both Cretaceous and Tertiary sands; and the "APZ-2" prospect, associated to the pre-cretaceous play and defined in prominent fold anticlines involving a very thick pre-Cretaceous succession, most probably of Paleozoic age that is preserved below the regional base Mesozoic-Tertiary.

Additionally, six exploration leads have also been defined in the Block: "Pz-B", Pz-C", "Pz-D", "Pz-E", "Pz-F" and "Pz-G", which are associated to this pre-Cretaceous play.

The following table summarizes the oil Prospective Resources for each of the prospects and leads in in the Arauca Block and the chance of success for each one:

Arrendajo

In the Arrendajo Block, and as a result of the interpretation of the available 2D and 3D seismic programs, five prospects have been identified: Yaguazo, Buho, Mirla Blanca, Tigua and Babillas. These prospects are looking for structural traps which were formed during the Tertiary, and all of them have exploration objectives in the C-3, C-5 and C-7 intervals of the Carbonera Formation. A summary of the estimated resources is presented below:

Lower Magdalena and Cesar Rancheria Basins

A total of 772.3 MMboe of gross Prospective Resources have been assigned to 1,005,862 net hectares, for five blocks:  La Creciente, Guama, SSJN-3, SSJN-7 and SSJN-9. These resources correspond to 4,271.3 Bcf of gas resources (equivalent to 749.3 MMboe) and 23.2 MMbbl of oil resources. The resource evaluation was made on identified prospects and/or leads for each block, and was based on available seismic, well data and seismic attribute analysis. A prospect was considered when is traversed by two or more separate 2-D seismic lines, or covered by full-fold 3D seismic data. Lead evaluation was based on areas where seismic data is relatively scarce and additional seismic information is required.

The following table summarizes the gas Prospective Resources for the identified prospects/leads for each block in the Lower Magdalena Basin (in terms of barrels of oil equivalent):

Note: BOE conversion is 5.7 Mcf per barrel using Colombian standard

La Creciente

In the La Creciente Block, six exploration prospects have been defined: Apamate Sur, Apamate Este,  La Creciente "C" Norte, La Creciente "C" Sur, La Creciente "G" and La Creciente DW. The first four prospects: "Apamate Sur", "Apamate Este",  La Creciente "C" Norte and La Creciente  "C" Sur  correspond to stratigraphic plays in onlapping Lower Porquero sands, and have been defined with seismic attribute analysis and seismic inversion.  The La Creciente "C" Norte, La Creciente "C" Sur are also   stratigraphic prospects, defined in the Lower Porquero.

Prospects "G" and "DW" have been defined in normal fault blocks, and were also assessed through seismic attribute analysis.

The following table summarizes the gas Prospective Resources for each of the six prospects in the La Creciente  Block and the chance of success for each one:

Guama

Three exploration prospects, "Sainero" and "Pedernalito 2X", have been defined in the Block. The "Sainero" prospect is a structural trap in a normal horst, in the eastern side of the block immediately to the west of the Arjona - Chimichagua yet-undeveloped gas discovery. In Sainero, four prospective intervals have been defined:  two in Miocene sands that tested gas in Arjona-1 (1A1 and 2A1), one interval of massive Basal Arjona (BA1) sands, and a bottom interval of Oligocene to early Miocene Cicuco - like carbonates or Pijiño-like Ciénaga de Oro sands.

The "Pedernalito-2X" was defined with the aid of seismic inversion and amplitude analysis in the flanks of two incipient shale diapirs in the northeast part of the block. This play is of combined type, i.e. stratigraphic (associated this time to sand updip pinch-out / truncation) and structural, on the dipping flank of the relatively shallow shale diapir. This play was successfully tested by well Pedernalito-1X, drilled in 2010.

The following table summarizes the gas Prospective Resources for each of the three prospects in the Guama Block and the chance of success for each one:

SSJN-3

In the SSJN-3 Block, three exploration leads have been defined: Manati Sur, Guamo Sur and Danta Sur. The three leads are defined in thrust folds of the San Jacinto Fold Belt in the western part of the block, in Oligocene and Eocene sands where gas shows were observed in nearby Manati-1, Guamo-1 and Danta-1 wells.

The table below shows the resources estimate for the SSJN-3 opportunities:

SSJN-7

Two exploration leads, Porquero Norte and Porquero Sur, have been defined in the west flank of the SSJN-7 Block where a Porquero succession of Miocene sands and shales is truncated by the regional base Pliocene unconformity, thus providing a stratigraphic trapping mechanism. According to geological studies, the gas in the area was generated from Lower Porquero and inferred Ciénaga de Oro shale source rocks. The following table summarizes the gas Prospective Resources for each of the two leads in the SSJN-7 Block:

SSJN-9

Two exploration prospects, Pijiño Norte and Filigrana, have been defined with the recently acquired 3-D seismic data. The Pijiño Norte is defined in the Oligocene Cienaga de Oro sands, in the downthrown block of a large normal fault, similarly to the trapping style at nearby Boquete field.

The Filigrana prospect is defined in a stratigraphic onlap closure of the Oligocene Ciénaga de Oro sands onto crystalline basement. The following table summarizes the estimated gas resources for each of the two prospects in the SSJN-9 Block and the chance of success for each one:

CR-1

Two exploration leads, "Leona" and "pre-Castillete", have been defined in the north of the Block, associated to the regional strike-slip Oca Fault system, thus providing a stratigraphic trapping mechanism. The "Leona" lead, defined with 2-D seismic, is a light oil structural play, in a fault block associated to the Oca system, defined in Cretaceous limestones and dolomites, a play that was successfully tested in a similar structural style in a nearby well in neighbouring Venezuela.

The "pre-Castillete" is a relatively shallow stratigraphic play for gas sourced from the same petroleum system as the Chuchupa - Ballena - Rio Hacha gas fields, located to the northwest in the Colombian Caribbean coast. The trap is defined in the stratigraphic toplap of Miocene sands, truncated by the regional Late Miocene unconformity.

The following table summarizes the resources for each of the two leads in the CR-1 Block:

Upper Magdalena Valley Basin

In the Upper Magdalena Valley Basin, a total of 35.9 MMbbls of oil gross Prospective Resources have been assigned to 56,783 net hectares for 2 blocks: Abanico and Buganviles. The resource evaluation was made on the identified prospects for each block, and was based on available seismic and well data.

The following table summarizes the oil Prospective Resources for the identified prospects for the two Blocks in the Upper Magdalena Valley Basin:

Abanico

In the northern part of the Abanico Block, a new exploration prospect has been identified with the 2D available seismic data. The Huracan Norte prospect has as a main exploration objective the upper and lower members of the Guadalupe Formation within an anticline structure that is truncated against the Tertiary unconformity as a main trapping mechanism.

The following table shows the estimated resources and the chance of success for the Huracan prospect:

Buganviles

In the Buganviles Block, one exploration prospect has been identified with the 2D available seismic data. The Tuqueque prospect has two main exploration objectives: the Lower Cretaceous Caballos Formation in a faulted anticline in the hanging wall of a inverted fault; and the Upper Cretaceous Monserrate Formation which the main trapping mechanism is defined as a faulted anticline.

The following table shows the estimated resources and the chance of success for the Tuqueque prospect:

Putumayo Basin

A total of 664.0 MMbbls of oil gross Prospective Resources have been assigned to 550,957 net hectares for 4 blocks: Topoyaco, Tacacho, Terecay and Putumayo-9.  The resource evaluation was made on the identified prospects and /or leads for each block, and was based on available seismic and well data.

The following table summarizes the oil Prospective Resources for the identified prospects /leads for each Block in the Putumayo Basin:

Topoyaco

The 2D and 3D seismic data interpretation allowed the identification of five prospects, in four separate fault blocks (A, B, C, D, and E). Prospects B and C were drilled in 2010, with wells Topoyaco 1X and Topoyaco-2X respectively.

After this first drilling campaign, four prospects remain in the block. The Caballos Formation in Fault Block C, and Fault Blocks A, D and E. Prospects A, C and E are faulted anticlines related to low angle reverse faults or thrusts, while prospect D is a sub-thrust structure monocline.

The table below sets out the oil Prospective Resources for each of the prospects in the Topoyaco Block:

Tacacho

Two leads have been identified in the Tacacho block (AX and BX), from the interpretation of seismic data, gravity, magnetic and SFD surveys. Tacacho AX is an inverted down-to-the-west normal fault where the previous downthrown block has been uplifted while the Tacacho BX is a structural Paleozoic high with Cretaceous and Tertiary sediments draping over it. The chance of discovery for these leads will be assessed, as these leads are upgraded to prospects, with the acquisition of more seismic data.

The table below sets out the oil Prospective Resources for each of the prospects in the Tacacho Block:

Terecay

Four leads have been identified in the Terecay block (AX, BX, CX and DX), from the interpretation of seismic data, gravity, magnetic and SFD surveys. Terecay AX and CX are stratigraphic pinch outs while the Terecay BX and DX are structural traps formed by inversion of previous normal faults. Chance of discovery for these leads will be assessed as these leads are upgraded to prospects, with the acquisition of more seismic data.

The table below sets out the oil Prospective Resources for each of the prospects in the Terecay Block:

Putumayo 9

The interpretation of existing 2D seismic data, previous well drilling and testing of the Mandur-4 well, has allowed the identification of one prospect in the Caballos formation. The prospect straddles the limits between this block and the Caguan-5 and Putumayo-3 blocks. An estimate of 24% (low estimate) or 29.7% (high estimate) of the prospect is within the Putumayo 9 block.  The prospect is a structural closure formed by the structural inversion of a previous downthrown block, on the western side of a down-to-the-west normal fault.

The table below sets out the oil Prospective Resources for each of the prospects in the Putumayo 9 Block:

PERU

A total of 1,263.9 MMbbls of gross Prospective Resources have been assigned by the Company to 1,883,533 net hectares for three blocks in the Peru Marañon and Ucayali Basins: Block 135, Block 137 and Block 138.  The interpretation of regional seismic and well data, and its integration with regional magnetic and gravimetric data, has allowed the Company to identify a total of eight leads in the three blocks. Two leads (one each) are located in blocks 135 and 137 in the Southern Marañon Basin and six leads were identified in Block 138, located in the Ucayali Basin, where the Company recently acquired 558.8 km of 2D seismic data.  The resource assessment report for Block 138 has been prepared by Petrotech using an effective date of June 30, 2011. The resource assessment report for Block 135 and Block 137 was provided by Petrotech in 2007.

The table below summarizes the oil Prospective Resources for each block.

Block 138

A total of 774.8 MMbbl of oil gross Prospective Resources have been assigned to the 138 Block. The Company has identified six leads in Block 138. Three of these leads occur at Cretaceous stratigraphic level (C1, C2, and C3) while the remaining three occur at Paleozoic levels below the base Cretaceous unconformity (P1, P2 andP3).

The Cretaceous leads are all structural compressional traps, while the Paleozoic prospects are of three types: P1 is a structural high between two north-south normal faults; P2 is an erosional sub-unconformity trap; while P3 is a stratigraphic Paleozoic remnant on top of basement. Chance of discovery for these leads will be assessed as they are upgraded to prospects.

The table below sets out the oil Prospective Resources for each of the prospects in the Peru Block 138:

Block 135

Block 135 is in the early stages of exploration and contains no seismic or well information within the block boundaries.  The interpretation of regional 2D seismic and well data outside the block and the integration of this information with regional magnetic and gravimetric data, have allowed the identification of one lead in this block. It is expected that with the acquisition and interpretation of new seismic data within the block boundaries, planned for early 2012, the number of identified leads present in the block should increase, as the gravimetric and magnetic interpretation suggests the existence of several structural highs and depocenters within the block.

The table below sets out the oil Prospective Resources for the identified lead in block 135.

Block 137

One lead has been identified in this block, with the interpretation of regional 2D seismic data, some of which enters in the block, and the integration of this interpretation with well, magnetic and gravimetric data. Due to environmental constrains, this block is currently under force majeure.

However, it is expected that with the acquisition and interpretation of new seismic data to be acquired within the block boundaries, the number of identified leads present in the block should increase.

The table below sets out the oil Prospective Resources for the identified lead in Block 137.

GUATEMALA

Amatique Basin /Area A7-98

The Amatique Basin is considered to have a very high exploration potential due to the possible southward extension of the prolific Campeche carbonate platform, which contains not less than five giant fields, Cantarell being the most important, with more than 32 billion barrels of reported original reserves.

In this basin, the Company has working interest in the Area A7-98, where Prospective Resources have been assigned to two oil leads, identified by existing seismic. The Jaguar and Semox leads are located in transpressional structures associated with the boundary of the Caribbean and North American plates.

The table below sets out the oil Prospective Resources for each of the prospects in the Area A7-98, which totals 53,793 hectares:

Notes:

Undiscovered resources are defined as those quantities of oil and gas estimated on a given date to be contained in accumulations yet to be discovered. The estimated potentially recoverable portion of Prospective Resources is classified as prospective resources. Prospective Resources are defined as those quantities of oil and gas estimated on a given date to be potentially recoverable from undiscovered accumulations. If discovered, they would be technically and economically viable to recover. However, there is no certainty that the Prospective Resources will be discovered. In addition, the following mutually exclusive Classification of Resources was used:

Low Estimate - This is considered to be a conservative estimate of the quantity that will actually be recovered from the accumulation. This term reflects a P90 confidence level where there is a 90% chance that a successful discovery will be more than this resource estimate.

Best Estimate - This is considered to be the best estimate of the quantity that will actually be recovered from the accumulation. This term is a measure of central tendency of the uncertainty distribution and in this case reflects a 50% confidence level where the successful discovery will have a 50% chance of being more than this resource estimate.

High Estimate - This is considered to be an optimistic estimate of the quantity that will actually be recovered from the accumulation. This term reflects a P10 confidence level where there is a 10% chance that the successful discovery will be more than this resource estimate.

Pacific Rubiales, a Canadian-based company and producer of natural gas and heavy crude oil, owns 100 percent of Meta Petroleum Corp., a Colombian oil operator which operates the Rubiales and Piriri oil fields in the Llanos Basin in association with Ecopetrol, S.A., the Colombian national oil company. The Company is focused on identifying opportunities primarily within the eastern Llanos Basin of Colombia as well as in other areas in Colombia and northern Peru. Pacific Rubiales has working interests in 46 blocks in Colombia, Peru and Guatemala, as well as a foothold in the Guyana offshore basin.

The Company's common shares trade on the Toronto Stock Exchange and La Bolsa de Valores de Colombia under the ticker symbols PRE and PREC, respectively.

Boe may be misleading, particularly if used in isolation. A boe conversion ratio of 5.7 mcf: 1 bbl is based on an energy equivalency conversion method primarily applicable at the burner tip and does not represent a value equivalency at the wellhead.

Cautionary Note Concerning Forward-Looking Statements

This press release contains forward-looking statements. All statements, other than statements of historical fact, that address activities, events or developments that the company believes, expects or anticipates will or may occur in the future (including, without limitation, statements regarding estimates and/or assumptions in respect of production, revenue, cash flow and costs, reserve and resource estimates, potential resources and reserves and the company's exploration and development plans and objectives) are forward-looking statements. These forward-looking statements reflect the current expectations or beliefs of the company based on information currently available to the company. Forward-looking statements are subject to a number of risks and uncertainties that may cause the actual results of the company to differ materially from those discussed in the forward-looking statements, and even if such actual results are realized or substantially realized, there can be no assurance that they will have the expected consequences to, or effects on the company. Factors that could cause actual results or events to differ materially from current expectations include, among other things: uncertainty of estimates of capital and operating costs, production estimates and estimated economic return; the possibility that actual circumstances will differ from the estimates and assumptions; failure to establish estimated resources or reserves; fluctuations in petroleum prices and currency exchange rates; inflation; changes in equity markets; political developments in Colombia, Guatemala or Peru; changes to regulations affecting the company's activities; uncertainties relating to the availability and costs of financing needed in the future; the uncertainties involved in interpreting drilling results and other geological data; and the other risks disclosed under the heading "Risk Factors" and elsewhere in the company's annual information form dated March 11, 2011 filed on SEDAR at www.sedar.com. Any forward-looking statement speaks only as of the date on which it is made and, except as may be required by applicable securities laws, the company disclaims any intent or obligation to update any forward-looking statement, whether as a result of new information, future events or results or otherwise. Although the company believes that the assumptions inherent in the forward-looking statements are reasonable, forward-looking statements are not guarantees of future performance and accordingly undue reliance should not be put on such statements due to the inherent uncertainty therein.

Prospective Resources are those quantities of petroleum estimated, as of a given date, to be potentially recoverable from undiscovered accumulations by application of future development projects. Prospective Resources have both an associated chance of discovery and a chance of development. Prospective Resources are further subdivided in accordance with the level of certainty associated with recoverable estimates, assuming their discovery and development, and may be sub-classified based on project maturity. There is no certainty that any portion of the resources will be discovered. If discovered, and they would be technically and economically viable to recover; there is no certainty that the Prospective Resource will be discovered. If discovered, there is no certainty that any discovery will be technically or economically viable to produce any portion of the resources.

SOURCE Pacific Rubiales Energy Corp.

WANT YOUR COMPANY'S NEWS FEATURED ON PRNEWSWIRE.COM?

440k+
Newsrooms &
Influencers

9k+
Digital Media
Outlets

270k+
Journalists
Opted In

GET STARTED