Jul 23, 2018
IFR Provides Operation Update at Tecolutla
Calgary, Alberta -- July 23, 2018 -- International Frontier Resources Corporation ("IFR" or the "Company") (TSX-V: IFR) (OTCQB: IFRTF) today provided an operations update on its Mexican joint venture, Tonalli Energia ("Tonalli") and its onshore oil and gas block Tecolutla.
At Tecolutla, Tonalli has finalized the completion of three intervals in its first evaluation well, TEC-10. Perforation and stimulation of the TEC-10 well commenced in late June targeting multiple zones in 138m of gross El Abra reef.
Production testing is on-going with the following results to date from each interval:
Since reaching total depth, Tonalli has utilized the modern well logs from TEC-10 to perform a pre-stack depth migration of the 3D seismic volume ("PSDM Seismic") to give a more precise image of the top of the El Abra. This PSDM Seismic has provided an explanation of the TEC-10 well results by identifying localized karsting or sink-hole type features along the top of the El Abra. These localized karsting features are filled with non-reservoir shales and mudstones that do not contain hydrocarbons. Tonalli's interpretation of the PSDM Seismic and the TEC-10 well logs indicate that the directionally drilled TEC-10 well encountered a small vertical karst feature at the prognosed top of the El Abra formation then exited this karst lower in the El Abra. This resulted in TEC-10 encountering non-reservoir shales and mudstones at depths where Tonalli expected the El Abra reef to be structurally high and have good reservoir quality.
The porous Interval C in TEC-10 was encountered after the well exited the karst feature and is structurally located at a similar elevation to perforations in the offset TEC-6 well. Based on the observed water cut, it is believed that Interval C of the TEC-10 well encountered a partially depleted portion of the El Abra reservoir which is inside the drainage radius of this offset well. Future wells in Tecolutla will be planned to be outside the drainage area of existing wells and to avoid localized karst features. The PSDM Seismic has also given us a more precise image of the reef edge which matches our original interpretation of the reef edge and further confirms the areal extent of the reef. Tonalli is confident that there is significant remaining oil in the reservoir that can recovered with horizontal wells that are strategically located.
"The information obtained by drilling TEC-10 has provided the necessary information to develop the remaining resources of the Tecolutla field with additional wells and workovers," stated Curtis Hess Vice President of Exploration. "Our understanding of the El Abra reservoir has greatly improved and Tonalli is in the process of developing a horizontal drilling development strategy based on this knowledge."
Tonalli is examining the next steps regarding TEC-10 and has commenced planning for the drilling of the first horizontal well ("TEC-11") and a workover of the TEC-7 well. Tonalli expects these to take place in late Q4 2018 and Q1 2019 pending regulatory approvals.
Tonalli has recently entered into a crude oil commercialization agreement with Pemex. At this time, Tonalli does not intend to produce from any wells in the Tecolutla field until appropriate production and water disposal facilities are constructed and after the next well is drilled successfully.
Through its joint venture, IFR was one of the first foreign companies to participate in Mexico's historic reform of the oil and gas sector. The Tecolutla block was awarded to Tonalli as part of the first round and third call of Mexico's oil and natural gas "mature fields" bid round ("Round 1.3"), the first in almost 80 years.
About International Frontier Resources
International Frontier Resources Corporation (IFR) is a Canadian publicly traded company with a demonstrated track record of advancing oil and gas projects. Through its Mexican subsidiary, Petro Frontera S.A.P.I de CV (Frontera) and strategic joint ventures, it is advancing the development of petroleum and natural gas assets in Mexico. The Company also has projects in Canada and the United States, including the Northwest Territories and Montana.
The Company's shares are listed on the TSX Venture, trading under the symbol IFR and on the OTCQB under the symbol IFRTF. For additional information please visit www.internationalfrontier.com.
For further information
Steve Hanson -- President and CEO
Tony Kinnon -- Chairman
Forward Looking Statements
This press release contains forward-looking statements and forward-looking information (collectively "forward-looking information") within the meaning of applicable securities laws relating to the Company's plans, strategy, business model, focus, objectives and other aspects of IFR's anticipated future operations and financial, operating and drilling and development plans and results, including, expected future production, production mix, reserves, drilling inventory, net debt, cash flow, operating netbacks, decline rate and decline profile, product mix, capital expenditure program, capital efficiencies, commodity prices, tax pools and targeted growth. In addition, and without limiting the generality of the foregoing, this press release contains forward-looking information regarding: anticipated cost savings and operational efficiencies; anticipated capital cost estimations; the focus and allocation of IFR's 2018 capital budget; anticipated production rates, available free cash flow, management's view of the characteristics and quality of the opportunities available to the Company; and other matters ancillary or incidental to the foregoing.
Forward-looking information typically uses words such as "anticipate", "believe", "indicate", "project", "target", "guidance", "expect", "goal", "plan", "intend" or similar words suggesting future outcomes, statements that actions, events or conditions "may", "would", "could" or "will" be taken or occur in the future. The forward-looking information is based on certain key expectations and assumptions made by IFR's management, including expectations concerning prevailing commodity prices, exchange rates, interest rates, applicable royalty rates and tax laws; capital efficiencies; decline rates; future production rates and estimates of operating costs; performance of existing and future wells; reserve and resource volumes; anticipated timing and results of capital expenditures; the success obtained in drilling new wells; the sufficiency of budgeted capital expenditures in carrying out planned activities; the timing, location and extent of future drilling operations; the state of the economy and the exploration and production business; results of operations; performance; business prospects and opportunities; the availability and cost of financing, labour and services; the impact of increasing competition; ability to market oil and natural gas successfully and IFR's ability to access capital.
Statements relating to "reserves" are also deemed to be forward looking statements, as they involve the implied assessment, based on certain estimates and assumptions, that the reserves described exist in the quantities predicted or estimated and that the reserves can be profitably produced in the future.
Although the Company believes that the expectations and assumptions on which such forward-looking information is based are reasonable, undue reliance should not be placed on the forward-looking information because IFR can give no assurance that they will prove to be correct. Since forward-looking information addresses future events and conditions, by its very nature they involve inherent risks and uncertainties. The Company's actual results, performance or achievement could differ materially from those expressed in, or implied by, the forward-looking information and, accordingly, no assurance can be given that any of the events anticipated by the forward-looking information will transpire or occur, or if any of them do so, what benefits that the Company will derive there from. Management has included the above summary of assumptions and risks related to forward-looking information provided in this press release in order to provide security holders with a more complete perspective on IFR's future operations and such information may not be appropriate for other purposes.
Readers are cautioned that the foregoing lists of factors are not exhaustive. Additional information on these and other factors that could affect IFR's operations or financial results are included in reports on file with applicable securities regulatory authorities and may be accessed through the SEDAR website (www.sedar.com).
These forward-looking statements are made as of the date of this press release and IFR disclaims any intent or obligation to update publicly any forward-looking information, whether as a result of new information, future events or results or otherwise, other than as required by applicable securities laws.
"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 or accuracy of this release". The Company seeks Safe Harbor.
You can return to the main News Releases page, or press the Back button on your browser.