MercoPress. South Atlantic News Agency

New natural gas discoveries in Magallanes Region

GeoPark Holdings Limited announced the discovery of two new gas fields in the extreme south of Chile, the Magallanes Region. The gas fields are on the Fell Block following the successful drilling and testing of the two new gas wells.

GeoPark drilled and completed the Nika Oeste 3 well to a total depth of 3,023 meters on a geological structure that had been re-defined following the interpretation of GeoPark's 3D seismic program. Approximately at 2,960 meters in an 11.5 meter perforated interval, gas flowed, without stimulation, at a rate of approximately 4.7 million cubic feet per day, 70 barrels per day (bpd) of condensate and 14 bpd of water with a well head pressure of 1,470 pounds per square inch (psi). These are preliminary results and further production history will be required to determine stabilized flow rates from this well and the extent of the reservoir. Construction has been initiated on a gas pipeline to connect the Nika Oeste 3 well to GeoPark's Kimiri Aike gas process and compression facility which connects with the regional gas infrastructure and the Methanex Corporation's methanol plant located 120 kilometers from the Fell Block. The Bump Hill 1 well was drilled to a total depth of 2,979 meters with a production test at approximately 2,820 meters in a 4 meter perforated interval, flowed, without stimulation, at a rate of approximately 0.9 million cubic feet per day (mmcfpd) of gas, 5 bpd of condensate and 4 bpd of water with a well head pressure of 420 psi. Bump Hill 1 will also be linked to the Kimiri Aike gas processing facility. Targeted completion of the two new gas pipelines is July 2008 with an expected increase in total sales production of 900 barrels of oil equivalent per day (boepd). GeoPark in its release states that it has drilled and successfully put on production seven new wells in Chile since its long term drilling program began in June 2007. Five other new wells have been drilled and are currently waiting for testing, sidetracking or remedial operations. GeoPark is involved in an aggressive and structured 100 million US dollars capital investment program during 2006 to 2008 to explore for and develop oil and gas in the Magallanes region in Chile, where it has become the first private-sector oil and gas producer in 2006. The company's 2008 capital investment program of 57 million US dollars in Chile and Argentina includes the drilling of 17-20 wells and construction of new production and infrastructure facilities. "The program represents a balanced mix of production, development, and exploration projects focused on both increasing oil and gas production and adding new oil and gas reserves", points out the GeoPark release. GeoPark shares are listed in London.