Petro Andina bags four blocks in Colombia

Calgary-based Petro Andina Resources was the successful bidder for the right to negotiate for exploration and production contracts on four exploration blocks in the Republic of Colombia at the Colombia Mini Round 2008.

The results were posted on the Colombian Hydrocarbons Agency (ANH) website. Petro Andina and partner, Columbus Energy were awarded blocks LLA-16, LLA-20, LLA-29 and LLA-30 in the prolific Llanos basin. Under the terms of the Mini Round 2008, bidders committed to a minimum work programme proscribed for each block and then bid a supplemental work program plus an “X-Factor” or additional royalty. Petro Andina will be operator of record of the blocks with a 50% working interest. The four blocks cover an area of about 495,000 gross acres, and each have exploration periods of six years made up of two, three-year phases. The first exploration phase will involve the acquisition of three dimensional (3D) seismic data and the drilling of exploration wells by Petro Andina and Columbus. The total net cost to Petro Andina to complete this exploratory work is around $46 million. In addition to the work commitments, Petro Andina and Columbus bid an X-factor of one percent (equivalent to a one percent royalty) to the ANH. Blocks 16 and 20 surround an existing 50 million barrel oilfield, discovered in 1974. The blocks currently have about 1300 kilometres of existing two-dimensional (2D) seismic data which show several promising leads. Blocks 29 and 30 are on trend with the Oropendola block which is owned 100% and operated by Columbus. Collectively, these blocks have about 650 kilometres of existing 2D seismic data and evaluation of the blocks was conducted with the benefit of 3D seismic and well information from the adjacent Columbus lands. The blocks will be subjectto standard ANH contracts and Petro Andina anticipates signing the contracts in the first quarter of the coming year, pending final approval of the Directive Counsel of the ANH.

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