East West Petroleum Provides Operational Update On Its Activities In New Zealand
June 12, 2013
Vancouver, British Columbia: June 12, 2013 East West Petroleum Corp. (TSX-V: EW, the “Company” or “East West”) is pleased to provide the following operational update on its activities in New Zealand.
The Company and its partner TAG Oil Ltd. (TSX-V: TAO, or “TAG”) are currently in the final stages of obtaining the necessary permits to drill on the East Cheal permit. The rig is being moved onto location having recently completed drilling of TAG’s Ngapaeruru-1 well in the East Coast Basin. Following receipt of the drilling permits, the first well targeting East Cheal is expected to spud in Q3 2013 and is estimated to take two to three weeks to drill and test. The rig will remain on location and drill a further four wells in succession to meet the work commitments on the permit.
East West will earn its interest in East Cheal by paying for the 100% of the costs to drill the first two wells; East West will receive 100% of net revenues from first production until cost recovery.
Drilling of three wells on South Cheal and one well on North Cheal is scheduled for Q4 of this year and is expected to complete by year-end. The total net cost to East West of the 2013 New Zealand drilling program is estimated at C$12.4 million and is fully funded out of East West’s existing cash balance of approximately C$23 million. A summary of the 2013 New Zealand work program is provided below:
Oil from any discoveries will be produced following the completion of satellite facilities that will allow trucking of oil to New Plymouth for export. Gas, if discovered will be processed following tie-in through TAG’s Cheal production facility and sold into the New Zealand natural gas grid. Earlier this year TAG completed the expansion of the Cheal facility to the current processing capacity of over 5,000 barrels of oil equivalent per day (http://www.tagoil.com/20130404-TAG-Oil-Cheal-Infrastructure-Expansion-Complete.asp).
David Sidoo, Executive Chairman of East West Petroleum commented, “We are very pleased to be drilling our first well in the Taranaki Basin with our partner TAG Oil. TAG is a world class partner has proven itself as one of the leading operators in New Zealand having successfully encountered commercial oil with their last 25 wells in the Taranaki, and East West is looking forward to continue working with TAG to identify and pursue additional opportunities in New Zealand, including reviewing available permits in New Zealand’s 2013 block offer. The spudding of the first East Cheal well will be an important milestone for East West as we enter the operational phase in New Zealand less than one year after entering the country in the 2012 licensing round.”
About East West Petroleum Corp.
East West Petroleum (http://www.eastwestpetroleum.ca) is a TSX Venture Exchange listed company which was established in 2010 to invest in international oil & gas opportunities and leveraging management's knowledge of unconventional play technical expertise. The Company has built an attractive platform of assets covering and area over 1.6 million acres: Three exploration permits adjacent to existing production in the Taranaki Basin of New Zealand with partner TAG OIL (TSX-V: TAO); four exploration concessions covering 1,000,000 acres in the prolific Pannonian Basin of western Romania with a subsidiary of Russia’s GazpromNeft; a joint venture exploration program covering 8,000 gross acres in the San Joaquin Basin of California; an oil-prone exploration block of 100,000 acres in the Assam region of India with the three largest exploration and production Indian firms ONGC, Oil India and GAIL; and a 100% interest in a 500,000 acre exploration block onshore Morocco with conventional and unconventional potential. The Company is now poised to enter operational phases in Romania, where it will be fully carried by its partner Gazprom-controlled Naftna Industrija Srbije in a seismic and 12-well drilling program expected to commence in 2013, and in New Zealand where the Company expects to commence drilling operations by Q3 2013, with nine wells to be drilled this year. The Company has adequate funds to cover all anticipated seismic and exploratory drilling operations through 2013.
Forward-looking information is subject to known and unknown risks, uncertainties and other factors that may cause the Company’s actual results, level of activity, performance or achievements to be materially different from those expressed or implied by such forward-looking information. Such factors include, but are not limited to: the ability to raise sufficient capital to fund exploration and development; the quantity of and future net revenues from the Company’s reserves; oil and natural gas production levels; commodity prices, foreign currency exchange rates and interest rates; capital expenditure programs and other expenditures; supply and demand for oil and natural gas; schedules and timing of certain projects and the Company’s strategy for growth; competitive conditions; the Company’s future operating and financial results; and treatment under governmental and other regulatory regimes and tax, environmental and other laws.
This list is not exhaustive of the factors that may affect our forward-looking information. These and other factors should be considered carefully and readers should not place undue reliance on such forward-looking information. The Company disclaims any intention or obligation to update or revise forward-looking information, whether as a result of new information, future events or otherwise.
David Sidoo, Chairman
telephone: +1 604 682 1558
fax: +1 604 682 1568
Greg Renwick, President & CEO
telephone: +1 972 955 7251
fax: +1 604 683 1585
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 this release.