Jun 06, 2019
IFR Joint Venture Provides Operations Update at Tecolutla -- Earns into License Contract
Calgary, Alberta -- June 6, 2019 -- International Frontier Resources Corporation ("IFR" or the "Company") (TSX-V: IFR) (OTCQB: IFRTF) today provided an operations update on its joint venture (JV), Tonalli Energia ("Tonalli") and its Mexican onshore oil and gas block Tecolutla.
Tecolutla Block Earn-In
Tonalli has been informed by Mexico's Comision Nacional de Hidrocarburos ("CNH") that it has completed its minimum work commitment required to earn-in on the Tecolutla Block in its 35-year license agreement. To date US$1,534,000 of Tonalli's total Account Performance Security Guarantee (APSG) that was posted with CNH to ensure completion of the minimum work commitment has already been returned. Tonalli is now in the process of applying for the return of its remaining US$1,764,000 APSG.
"Completing our minimum work commitment is an important milestone for Tonalli and IFR and demonstrates our team's abilities to execute and perform to the Mexican government, our partners and industry," stated President and CEO Steve Hanson. " The completed work units required were performed thru core studies, seismic reprocessing, well workovers and drilling activities."
TEC-11 Horizontal Well
Tonalli is finalizing preparations to commence the perforation and stimulation of the TEC-11 horizontal well. Tonalli experienced delays in this operation due to problems with availability of certain services and tools, which have now been rectified. Tonalli expects to finalize this operation in late June and will then commence production testing.
In May 2019 Tonalli re-entered the TEC-2 well and performed further downhole operations. As a result, a new production test is currently ongoing. The first 12 days of this test has yielded a result of 62 barrels of oil per day (BPD) of oil on average at a 43% oil cut.
Tonalli is also preparing to move a service rig onto the recently upgraded TEC-7 well pad to conduct a workover, which will be followed by a production test. The TEC-7 well has not produced since 2006 and a workover has not been performed since 1971.
Tonalli is continuing to produce TEC-10 through rental equipment as a single well battery. Production from TEC-10 averaged 89 barrels of oil per day (BPD) during Q1 of 2019.
IFR will advise on the results of production of TEC-11, TEC-7 and TEC-2 after the tests are finalized. Tonalli is expecting to construct pipelines to connect the Tecolutla wells to centralized production equipment. This work is expected to occur during the summer and fall of 2019. The use of centralized production facilities as opposed to single well batteries is intended to result in lower operating costs for the field.
The Tecolutla field is located within the Tampico-Misantla basin, which has multiple reservoirs with diverse play types and access to existing infrastructure, market, service sector providers and an established supply chain. In 2017, IHS Markit identified the Tampico-Misantla Basin as a potential "Super Basin".
Through its JV with Grupo Idesa, 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").
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 2017 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", "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, labor 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.
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