Touchstone Exploration Inc (PBEGF)

[pro_s2009]

https://trinidadexpress.com/business/local/crude-oil-could-soon-flow-from-touchstone-s-royston-discovery/article_076699c4-bd55-11ed-98f6-a7909c6d6dd3.html

Crude oil could soon flow from Touchstone’s Royston discovery

By the middle of April, the country should have a better idea whether Touchstone’s Royston oil discovery is as substantial as the company thinks it is and if it would see an immediate addition to the country’s oil production.

President and chief executive officer of the Canadian outfit, Paul Baay told Express Business the Touchstone 1-X well, which was recently completed, encountered a total section of about 1,700 feet, one of the thickest sections Touchstone has seen in its on-land drilling campaign, and 740 feet of sand that it thinks is prospective.
Paul Baay

The company, however, will not know if it is hydrocarbon-bearing sands until it is able to perforate and complete the well.

In an interview with Express Business Baay said, “It will be about a month before we can move the rig over to Cascadura because we are still building the drilling site, so Royston probably won’t be tested until sometime in April, probably early April, or mid-April and then if it is light oil as we think it is, then it will virtually come on production right away.”

The company recently announced that Royston-1X was drilled to a total depth of 11,316 ft and encountered substantial sands in the targeted Herrera Formation.

It noted that drilling operations took approximately 25 days, which was ahead of schedule and on budget.

Baay added that this is the deepest well Touchstone has drilled to date and also is the deepest well drilled onshore Trinidad in the last 15 years.

“The fact that the well was drilled ahead of schedule and within our budget can be attributed to the best-in-class industry standards that Touchstone is driving within Trinidad, both through the introduction of new equipment, as well as additional expertise that we have added to our technical team,” Baay boasted.

He added, “We are encouraged by the hydrocarbon indications internally interpreted from open-hole wireline logs, which show that the well successfully intersected the Herrera Formation through the sub-thrust level in one of the thickest turbidite sections observed in any of our previous wells. Once the drilling pad is completed at our Cascadura C location, the drilling rig will be moved off the Royston location, and we will commence a comprehensive testing programme that is currently anticipated to begin in April. We will update the market when results become available.”

Touchstone’s president told Express Business that the estimate of being able to produce between 6,000 and 10,000 barrels of oil per day (bo/d) was still on.

He said, “I think those are still good numbers for the field, if these completions turn out the way we want, that’s certainly our target.”

According to Baay, the plan is to put Royston on production while Touchstone drills its next two wells at its Cascadura gas field and then head back to Royston.

“We already have the approval to drill two more wells off of that same pad, so if it works we will come right back over in late 2023 and start the development at Royston, “ Baay revealed.

He estimates that the first well will produce in the vicinity of 500 bo/d and said to get to the 6,000 bo/d to 10,000 bo/d it would mean drilling up to 21 wells in the field and having them simultaneously on production.

“Our pre-drill estimate of what we were looking for here was approximately 500 barrels a day. And we would like to see that from each well, it sort of gives you an idea of what we are looking at, something which at the end of the day is something between 12 and 20 wells in the pool,” Baay noted.

He said the hope is to have all of the wells drilled and on production by 2024.

If successful this will be good news for Trinidad and Tobago which has only been able to hold production at close to 60,000 bo/d and not increase production, even at times of high prices.

On the issue of the Cascadura gas development, Baay said the company will be ready to send the first gas whenever the National Gas Company (NGC) is able to receive it.

“We got notified by the NGC that their pipelines are going to be ready by the end of June, and that’s a little later than we had hoped. We will probably be ready by the middle of May. We will have our part of the facility all done and ready by the middle of May so we will make sure we are ready and whenever the NGC is ready we can send them first gas.”

Touchstone recently told investors that the NGC will not be ready to receive gas from its Cascadura field until June 30, almost two months behind schedule.

Touchstone said, “On February 24, 2023, the Company was notified by The National Gas Company of Trinidad and Tobago Limited (NGC) that they expect to be ready to receive first gas from the Cascadura natural gas and associated liquids facility on or about June 30, 2023.”

Touchstone said it remains on track to complete the Cascadura facility prior to this date to ensure production can commence as soon as NGC is in a position to receive the first gas.

Baay told Express Business the plan is to start at 60 million standard cubic feet per day (mmscf/d) and then drill the two additional development wells that Touchstone intends to bring on at the end of 2023.

He said, “We will like to see that facility be about 100mmscf/d by December 31, 2023... The target would be somewhere between 150 mmscf/d and 200 mmscf/d I think, which is ultimately where we want to get to on that facility. We need to do some more drilling to get to that high end of the plan.”

That 150mmscf/d does not include its Coho development which is choked at eight mmscf/d.

He said, “It’s been running closer to about eight mmscf/d and that’s mainly due to the pressures going into the Shell facility. The well is still what we call choked back to meet the pressures into the Shell facility. It is capable of much more but that’s all we are able to run it at right now.”