NG Energy Receives Final License Required For Maria Conchita Block To Enter Production
NG Energy International (TSXV: GASX) continues to inch closer to finally achieving natural gas production at its Maria Conchita concession block in Colombia. The firm this morning revealed that it has received an amended environmental license from the National Authority, which now includes the Aruchara-1 well.
The granting of the license permits the company to conduct production at Aruchara-1, the first such well to be put into production by the company. With the receipt of the amended permit, the company is now able to lay the final 40 metres of flow line required, which will connect the well to the gas plant that has been completed on site.
The permit also enables the company to complete the final connection point to the main pipeline in the region, the Transportadora de Gas Internacional, or TGI, line. The line will be utilized to transport natural gas from the Maria Conchita concession to market.
Further, with the amended permit now in hand, extended well testing can now occur. The extended testing will be conducted to test the productivity and characteristics of the reservoir, and providing data to the company on the best production method to maximize recovery. Gas produced during this extended testing is expected to be commercialized.
Finally, nitrogen testing of the gas plant is nearly complete, with low, mid, and high pressure testing having seen significant progress. Once the Aruchara-1 well is connected, final testing with natural gas is to be conducted, which is expected “in the coming days.”
The company has previously indicated that once the facility and pipelines are completed, it will then be able to convert three currently outstanding letters of intent with natural gas majors in the region to that of final take or pay contracts, which will enable cash flow generation to begin. The Aruchara-1 well is expected to produce between 16 and 20 million standard cubic feet per day of natural gas.
NG Energy last traded at $1.63 on the TSX Venture.
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