Touchstone Exploration ups crude oil and natural gas reserves

Touchstone Exploration Inc (LON:TXP, TSE:TXP) announced a jump crude oil and natural gas reserves at its Trinidad exploration properties.

Total proved, probable and possible (3P) net reserves, the widest measure, surged 236% to 100,150 thousand barrels of oil equivalent (Mboe) as of the end of 2020. The figure included total proved net reserves (1P) – those with the highest likelihood of being recovered – which grew 189% to 34,238 Mboe from the previous year.

“Our year-end 2020 reserves evaluation provides further independent confirmation of the significant opportunities that the company has in place from our Trinidad assets,” said Paul Baay, president and chief executive of Touchstone. “Our 1P reserves are now significantly higher than our 3P reserves at the same time last year, providing greater operational and financial certainty for investors, and exclude any potential reserves from the recently drilled Chinook-1 well or Cascadura Deep-1 wells.

“We have a lot to be excited about as we focus on converting our world class reserves to production during 2021 as well as expanding opportunities through additional drilling at Ortoire.”

The Chinook-1 and Cascadura Deep-1 wells were drilled in the fourth quarter of 2020.

Touchstone has tested two low resistivity zones in the Chinook-1 well. The first zone was considered uneconomic due to the high volume of water, but the company said indications of light oil prove the concept of hydrocarbons. Touchstone has permanently abandoned this lowermost zone and completed a second zone in the Herrera formation which encountered 35 degrees API sweet oil and is being configured for an extended oil production test.

“This is an encouraging start to the production testing programme as it confirms the presence of hydrocarbons in the sub-thrust sheet and will allow for further up-dip drilling targets based on available 3D seismic data,” said chief operating officer James Shipka.

“The sub-thrust sheet was not one of the original Chinook-1 well targets, so the confirmation of hydrocarbons in the deep section is very positive,” he added. “Although the lower zone was considered uneconomic given the high water cuts, the reservoir displayed potential as fluid flowed to surface at over 2,200 bbls/d. Future targets structurally up-dip from Chinook-1 hold tremendous potential.”

Touchstone expects to conducting the first natural gas test at the Cascadura Deep-1 well while the Chinook-1 well is on the extended oil production test.