CALGARY, ALBERTA--(Marketwired - Apr 24, 2015) - Mart Resources, Inc. (MMT.TO) -
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The combined net delivery of oil from the Umusadege field through the Umugini pipeline and the Nigerian Agip Oil Company Limited ("NAOC") export pipeline totaled approximately 579,700 bbls in March 2015 before estimated combined pipeline and export facility losses, and approximately 503,560 bbls after deduction of combined pipeline and export facility losses for March 2015 as estimated by Mart.
Mart Resources, Inc. ("Mart" or the "Company") and its co-venturers, Midwestern Oil and Gas Company Limited ("Midwestern", Operator of the Umusadege field) and SunTrust Oil Company Limited are providing the following updates on Umusadege field production for March 2015 and other operations.
March 2015 Aggregate Production Update
Umusadege field production during March 2015 averaged approximately 19,000 bopd resulting in total production of approximately 588,860 bbls for the month. Aggregate calculated Umusadege field downtime during March 2015 was zero days (based upon days with production of more than 10,000 bopd being considered to have no downtime). Although shutdowns of both the NAOC and Trans Forcados export pipelines were experienced during March 2015 due to operational interruptions for general pipeline repairs and maintenance, ongoing production from the Umusadege field was minimally affected due to the ability of the field operator to alternate production between the two pipelines. The average field production based on producing days was approximately 19,000 bopd in March 2015.
The combined net delivery of oil from the Umusadege field through the new Umugini pipeline and NAOC export pipeline totaled approximately 579,700 bbls in March 2015 before estimated pipeline and export facility losses, and approximately 503,560 bbls after deduction of combined pipeline and export facility losses estimated for March 2015 by Mart.
NAOC Export Pipeline Update
Total net crude oil deliveries into the NAOC export pipeline from the Umusadege field for March 2015 were approximately 243,600 bbls before pipeline losses. Based upon the 12-month rolling average rate of pipeline and export facility losses from December 2013 to November 2014 of 17.46%, Mart estimates NAOC pipeline and Brass River export facility losses for March 2015 will be approximately 42,530 bbls. Accordingly, Mart estimates that the total net crude deliveries into the NAOC export pipeline from the Umusadege field for March 2015 less estimated pipeline losses will be approximately 201,070 bbls.
As previously announced, total net crude oil deliveries into the NAOC export pipeline from the Umusadege field for February 2015 were approximately 146,070 bbls. Actual NAOC pipeline and export facility losses have not been allocated for February 2015 because allocation was suspended beginning in December 2014 by the Department of Petroleum Resources pending an approved loss computation formula. Mart previously estimated pipeline and export facility losses for February 2015 to be approximately 25,500 bbls, based upon the 12-month rolling average rate of pipeline and export facility losses of 17.46% between December 2013 and November 2014.
The NAOC export pipeline was shut down for five days in early April 2015 due to vandalism of the ASE pipeline. The NAOC export pipeline resumed normal operations on April 11, 2015. The NAOC pipeline was also shut down from April 16 to 19, 2015 because of a lack of storage capacity at the Brass River export terminal due to export shipment delays.
Umugini Pipeline Update
Mart and its co-venturers have not received official reports from the operators of the Trans Forcados export pipeline or the Forcados oil export terminal stating actual oil injection volumes or pipeline and export facility losses for the Trans Forcados export system. Based upon Mart's internal production and facility data, the Company estimates that Umusadege field deliveries into the Trans Forcados export pipeline connected to the Forcados oil export terminal were approximately 336,100 bbls in March 2015. Based upon historic pipeline losses encountered by other exploration and production companies utilizing the Trans Forcados export system, Mart estimates pipeline and export facility losses of 10% of crude oil deliveries, resulting in estimated Umusadege field deliveries of approximately 302,490 bbls for March 2015 after deduction of estimated pipeline and export facility losses.
The Umugini pipeline has been down since April 4, 2015 due to an explosion and spill that shut down the Trans Forcados pipeline. Repairs to the Trans Forcados pipeline have been completed and the system is expected resume normal operations soon.
Drilling update
Operations have commenced on the UMU-8 well site to side-track and deepen the existing UMU-8 well. The UMU-8 drilling program is intended to appraise intervals below the XV sand, specifically horizons XVIII through XXI, which have not yet been penetrated in the central prospect. The target depth is approximately 8500 feet.
Trucking of Crude Oil from UMU-13
Trucking of crude oil from the UMU-13 well to the Central Processing Facility has commenced and will continue until a permanent flowline is constructed to tie the UMU-13 well into the facility. An average of about 1,400 bopd is currently being trucked from UMU-13, and the target volume is approximately 3,000 bopd.
Additional information regarding Mart is available on the Company's website at www.martresources.com and under the Company's profile on SEDAR at www.sedar.com.
Except where expressly stated otherwise, all production figures set out in this press release, including bopd, reflect gross Umusadege field production rather than production attributable to Mart. Mart's share of total gross production before taxes and royalties from the Umusadege field fluctuates between 82.5% (before capital cost recovery) and 50% (after capital cost recovery).
Forward-Looking Statements and Risks
Certain statements contained in this press release constitute "forward-looking statements" as such term is used in applicable Canadian and US securities laws. Any statements that express or involve discussions with respect to predictions, expectations, beliefs, plans, projections, objectives, assumptions or future events or are not statements of historical fact and should be viewed as "forward-looking statements". These statements relate to analyses and other information that are based upon forecasts of future results, estimates of amounts not yet determinable and assumptions of management. Such forward-looking statements involve known and unknown risks, uncertainties and other factors which may cause the actual results, performance or achievements of the Company to be materially different from any future results, performance or achievements expressed or implied by such forward-looking statements.
In particular, there is no assurance that there will not be future disruptions of the NAOC export pipeline or Brass River export facility. Any future disruptions may materially and adversely affect the ability of the Company to transport, deliver and sell its crude oil production from the Umusadege field. Pipeline and export facilities losses are expected to continue in the future and such losses could be material. There is no assurance that there will not be adjustments to previously reported pipeline and export facilities losses by NAOC. There is no assurance that the estimates of current month pipeline and export facilities losses will reflect actual losses once reported to the Company by NAOC.
There is no assurance that there will not be future disruptions to the Umugini Pipeline, Trans Forcados export pipeline or the Forcados export terminal. Any future disruptions may materially and adversely affect the ability of the Company to transport, deliver and sell its crude oil production from the Umusadege field. Record daily volumes of oil deliveries referenced herein are not necessarily indicative of future monthly average daily oil delivery volumes. There is no assurance on when the operators of the Trans Forcados export system will report actual oil injections or pipeline and export facility losses to the Company or that the estimates of the Company regarding oil injection volumes or pipeline and export facility losses will reflect those volumes and losses reported by the operators of the Trans Forcados export system to the Company. The Umugini pipeline is a new pipeline and will continue to face risk associated with any new pipeline installation and with risks generally associated with pipeline operations in Nigeria.
There is no assurance that the Company will be able to successfully sidetrack or deepen the UMU-8 well or that if successful that the well will be commercially produced. Statements (express or implied) regarding the ability of the Company to successfully sidetrack or deepen and commercially produce, transport and sell oil from the UMU-8 well (or any one or more of the hydrocarbon sands encountered or identified by the UMU-8 well) should all be viewed as forward-looking statements.
There is no assurance that the Company will be able to successfully construct a permanent flowline to tie the UMU-13 well into the Central Processing Facility or that the Company will be able to continue to truck crude oil production to the Central Processing Facility. There is no assurance that Company will be able to increase trucked production as suggested or at all.
There can be no assurance that such forward-looking statements will prove to be accurate as actual results and future events could vary or differ materially from those anticipated in such statements. Accordingly, readers should not place undue reliance on forward-looking statements contained in this news release. The forward-looking statements contained herein are expressly qualified by this cautionary statement.
Forward-looking statements are made based on management's beliefs, estimates and opinions on the date the statements are made and the Company undertakes no obligation to update forward-looking statements and if these beliefs, estimates and opinions or other circumstances should change, except as required by applicable law.
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