Colombian state-controlled oil company Ecopetrol on Thursday declared the commercial viability of the Eastern Cano Sur block, which is expected to yield 25,000 barrels of crude per day by mid-2016.
Ecopetrol said in a press release that the "initial declaration could incorporate 1P (proven) reserves estimated in 22.4 million barrels of crude (including royalties)."
"We are very pleased to announce the commercial viability of this block, which contributes to Ecopetrol's target of producing 1 million clean barrels (per day) by 2015 and which is one of the outcomes of the exploratory campaign we have been working on steadily since the last decade," CEO Javier Gutierrez was quoted as saying in the release.
Ecopetrol said that through Nov. 30 it had drilled 61 exploratory, stratigraphic and appraisal wells in Eastern Cano Sur, a block in the eastern province of Meta in which the company has a 100 percent interest.
That exploratory campaign confirmed the existence of "sufficient reserves to begin the development stage in profitable conditions," the release said.
Low-level production has been carried out at Eastern Cano Sur since May 2011, when the first discovery was made.
The company now plans to invest $656 million over the next five years to develop the block, including drilling 135 wells, building surface facilities and making social and environmental investments.
The block encompasses 54,211 hectares (209 sq. miles), or 9 percent of the 611,000-hectare Cano Sur block that Ecopetrol is continuing to explore.
The Cano Sur block contract was executed with Colombia's ANH oil regulator on June 20, 2005, and has a term of 24 years after the declaration of commercial viability, Ecopetrol said.
"The results obtained in Cano Sur confirm the potential for heavy crudes in this zone, one of the strategic focuses of the company," Gutierrez was quoted as saying.
Ecopetrol's most recent discoveries - in blocks such as CPO-9 and Cano Sur - have been concentrated in Meta province.
Meta currently accounts for around 55 percent of the output of Ecopetrol and its partners, with most of that production occurring at the Castilla, Chichimene and Rubiales fields.
Colombia has roughly 2 billion barrels of proven oil reserves and is striving to boost that total with new discoveries. EFE