Austral Pacific Energy - Operations Update
June 11 2008 - 4:03AM
PR Newswire (US)
WELLINGTON, New Zealand, June 11 /PRNewswire-FirstCall/ -- Austral
Pacific Energy Ltd. (TSX-V: APX; NZSX: APX; Amex: AEN) Preparations
are now complete and the A6 well is scheduled to start drilling in
the next 24 hours. The well will drill through a secondary
reservoir and into the primary target over the next 14 days. The
well is being drilled from a surface location adjacent to the Cheal
production facility and will be directionally drilled to reach the
reservoir some 1000 meters to the west and to a depth of 1750
meters. If the well is successful, it is modeled to add 320,000bbls
of recoverable oil and 250 - 350 barrels of oil per day (bopd) to
the field's current production rate in the order of 500bopd. At
today's oil price (~$US130/bbl), and production rate, the field
generates a revenue stream of over US$1.95m/ month. Success in this
first of two wells could increase production to approximately
800bopd and the field revenue stream to $US3.1m/ month. Austral
Pacific holds a 69.5% working interest in the field. The A7 well is
scheduled to follow the drilling and completion of the A6 well.
Austral Pacific has been actively pursuing its strategy to focus on
its core assets of Cheal, Kahili and Cardiff; increase production
and reduce costs through a series of steps that have been announced
individually over the past month. Commenting on recent activity in
the company, Austral CEO Mr Thom Jewell said, "We have successfully
completed the monetization of our assets in Papua New Guinea; we
have reduced the primary company debt from $US18.5m at year end to
$US9m allowing the company to take on additional debt to benefit
from the full upside of high oil prices. The impact of closing out
the hedge is an increase in Austral's revenue from Cheal from $US
0.68m/month to $US 1.4m/month and an increase in the margin per
barrel from approximately $US40 to $US105. Mr Jewell further
commented that, "in a success case, the A6 well and A7 wells will
increase production and further increase the per barrel margin by
making more efficient use of the new production facilities."
Commenting on other announcements, Mr Jewell said he was
disappointed in the apparent reaction by a few of the company's
shareholders to its decision to reduce the number of exchanges from
three to two with the voluntary withdrawal from the AMEX. He said,
"All of our shareholders will be able to freely trade in the stock
through the TSX-V or the NZX and the company will be able to
significantly reduce the costs and compliance complexity of its
business." In other news, the longest standing member of the
Austral Pacific board of Directors, Mr Ron Bertuzzi, has decided to
step down. Mr Bertuzzi has been actively involved in the company
since 1992 and served on the board from October 1992 until October
1996 and then again from March 1998. With the addition of Peter
Hazledine in January 2008, the board remains fully functional in
its strategic and fiduciary responsibilities. "I have enjoyed
working with Ron and I would personally like to thank him for his
invaluable contribution over the past 16 years," Mr Jewell said.
Web site: http://www.austral-pacific.com/ Email: Phone: Thom
Jewell, CEO +64 (4) 495 0880 None of the Exchanges upon which
Austral Pacific's securities trade have approved or disapproved the
contents hereof. This release includes certain statements that may
be deemed to be "forward-looking statements" within the meaning of
applicable legislation. Other than statements of historical fact,
all statements in this release addressing future production,
reserve potential, exploration and development activities and other
contingencies are forward-looking statements. Although management
believes the expectations expressed in such forward-looking
statements are based on reasonable assumptions, such statements are
not guarantees of future performance, and actual results or
developments may differ materially from those in the
forward-looking statements, due to factors such as market prices,
exploration and development successes, continued availability of
capital and financing, and general economic, market, political or
business conditions. See our public filings at
http://www.sedar.com/ and
http://www.sec.gov/edgar/searchedgar/webusers.htm for further
information. DATASOURCE: Austral Pacific Energy CONTACT: Thom
Jewell, CEO of Austral Pacific Energy, +64 (4) 495 0880, Web site:
http://www.austral-pacific.com/
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