Mart Resources, Inc.: Operations and Production Update
Marketwired
CALGARY, ALBERTA--(Marketwired - Aug 12, 2013) - Mart Resources, Inc. (TSX VENTURE:MMT) ("Mart" or the "Company") and its co-venturers, Midwestern Oil and Gas Company Plc. (Operator of the Umusadege field) and SunTrust Oil Company Limited are providing the following updates on Umusadege field production for July 2013, the UMU-11 well, status of a second drilling rig, and Umugini pipeline construction.
July 2013 Production Update
Umusadege field production during July 2013 averaged 10,800 bopd. Umusadege field downtime during July 2013 was approximately 4.5 days due to sporadic shutdowns required for commissioning and testing of the new central processing facility and operations connected to preparation for drilling of the UMU-11 well. The average field production based on producing days was 13,200 bopd in July 2013, which is the highest average daily production rate for a calendar month based on production days realized from the Umusadege field.
Total net crude oil deliveries into the export pipeline from the Umusadege field for July 2013 were approximately 347,100 bbls before pipeline losses. Pipeline and export facility losses for May 2013, June 2013 and for July 2013 have not yet been reported by the export pipeline operator, Nigerian Agip Oil Company ("Agip"). In the past, Agip has reported pipeline and export facility losses one month after the final reporting of each month's injection totals, but for the past two months the pipeline losses have not been reported. Mart and its co-venturers have requested the loss information from Agip and will release this information as soon as it is received.
As a result of negotiations with Agip, the Umusadege field has been allocated an additional pipeline reserved production capacity of 4,500 bopd. An increase in oil shipments from the Umusadege field will be achieved after more powerful pumps are obtained and installed by Agip.
UMU-11 Well Update
The drilling rig was skidded ahead, and new 20-inch conductor pipe has been pile driven to a final depth of 330 feet. The conductor pipe will be cleaned out and secured, and drilling operations are expected to commence shortly thereafter.
After completion of the UMU-11 well, an exploration/appraisal well is planned to be drilled on the East exploration structure.
Second Drilling Rig
A tender for a second drilling rig was successfully completed, and after site preparation the second drilling rig is expected to start drilling a water disposal well in September 2013. After completion of the water disposal well, the drilling rig will move to the UMU-4 location to drill a re-entry horizontal development well. Mart and its co-venturers plan to drill several additional horizontal wells in the Umusadege field.
Umugini Pipeline Construction Update
As previously reported, construction of the Umugini pipeline has been completed from the location near the Umusadege field to a point approximately 17 kilometers into the 51-kilometer pipeline. Construction operations are being delayed due to weather conditions and heavy rains in the area that required the construction contractor to shut down. It is now expected that pipeline construction will be completed in the first quarter of 2014. As previously announced, the pipeline has two segments. The first segment is from the Umusadege field south to the Ogini flow station on OML 26. This section is 23 kilometers in length and is where the 17 kilometers of pipeline construction has been completed. The second segment is from the Ogini flow station west to the Eriemu flow station. This section of the pipeline will be constructed along an existing right of way and will be twinning the existing pipeline currently operating between the Ogini flow station and the Eriemu flow station. The Umugini pipeline will provide a second independent export pipeline for Umusadege field production. The Umugini pipeline's gross transportation capacity will be approximately 45,000 barrels per day and it will connect the Umusadege field to the Trans Forcados export pipeline. The Trans Forcados export pipeline will deliver crude oil from Umusadege field to the Forcados export terminal operated by Shell. Negotiations regarding the crude handling agreement with the export pipeline and terminal operators are nearing completion.
Mart and its co-venturers continue to evaluate other opportunities in Nigeria including divestments being made by major oil companies and other marginal fields.
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 AGIP pipeline or that future repairs will not be required. Any future disruptions will materially and adversely affect the ability of the Company to transport, deliver and sell its crude oil production from the Umusadege field. Statements (express or implied) concerning the allocation of export and pipeline capacity to the Umusadege field from their third party pipeline owners, should also be viewed as forward looking statements.
There is no assurance that the UMU-11 well will be spudded by the date forecast. There is also no assurance that the drilling of UMU-11 will meet the stated objectives.
There is no assurance that construction and completion of the Umugini Pipeline referenced herein will be completed within the timeframes indicated or at all or that Mart and its Co-venturers will be able to enter into an acceptable crude oil handling agreement. There is no assurance that the production capacity of the Umugini Pipeline will be adequate for future levels of Umusadege field oil production. Any new export pipeline will face risks generally associated with pipeline operations in Nigeria including the risk of pipeline disruption and line losses. 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 no 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.
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 no 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.
NEITHER THE TSX VENTURE EXCHANGE NOR ITS REGULATION SERVICES PROVIDER (AS THAT TERM IS DEFINED IN THE POLICIES OF THE TSX VENTURE EXCHANGE) ACCEPTS RESPONSIBILITY FOR THE ADEQUACY OR ACCURACY OF THE RELEASE.
