MercoPress. South Atlantic News Agency

Successful testing of natural gas strike in Chilean Patagonia

Latinamerican oil and gas exploration and production company GeoPark Holdings Limited reported the successful testing of a natural gas well in Magallanes region, extreme south of Chile, with an initial output of 1.300 barrels of oil per day equivalent, boepd.

GeoPark that has producing properties in Chile and Argentina and has 100% working interest in the new Manekenk 1 well on the Fell Block in Chile GeoPark drilled and completed the Manekenk 1 well to a total depth of 3,061 metres on a new geological structure and trend that had been defined following the interpretation of GeoPark's 3D seismic program. A production test in the Springhill formation, at approximately 2,951 metres in an 11 metre perforated interval, flowed, without stimulation, at a rate of approximately 7.3 million cubic feet per day (mmcfpd) of gas, 102 barrels per day (bpd) of condensate and 20 bpd of water through a choke of 10 millimetres (mm) and with a well head pressure of 2,218 pounds per square inch (psi). These are preliminary results and further production history will be required to determine stabilised flow rates from this well and the extent of the reservoir, according to the company. A pipeline is being constructed to the well-site to connect to the main pipeline infrastructure - with a target completion date between 8-12 days. The gas will be sold to the Methanex Corporation at its large methanol production facility located 120 kilometres from the Fell Block, next to Punta Arenas and the oil is being sold to ENAP (Chile's state-owned oil company). To date in 2008, GeoPark has successfully drilled and tested nine new wells in Chile - including four new field discoveries. Seven of these wells are now on production and two wells are targeted to begin production during December 2008. GeoPark has recently completed drilling two new wells on the Monte Aymond and Aonikenk fields in the Fell Block and will begin testing operations this month. The company is completing a 57 million USD capital expenditure program in Chile in 2008 and is currently producing approximately 4.700 boepd. With wells already tested, but not yet on stream, GeoPark is on schedule to meet its end of year production target of 6.000 boepd. "We are pleased with the important result from the new Manekenk well, which will contribute to the Company's significant growth in production, revenues and reserves during 2008. The Manekenk discovery also validates a promising trend which the Company opened up earlier this year in the central portion of the Fell Block and which will be further tested in a new well during the First Quarter 2009. This new well also continues our successful track record of finding and developing oil and gas in Chile where we have the people, infrastructure and long term strategy in place to achieve an excellent return on our capital and also become a significant contributor to energy production", said Gerald E. O'Shaughnessy, Chairman of GeoPark.