By OGJ editors
HOUSTON, Apr. 29 -- Kappa Resources Colombia Ltd., a private Calgary company, has completed a farmout agreement that allows UK-based Black Rock Oil & Gas PLC to participate and earn an interest in Kappa's 249,000-acre Las Quinchas Association Contract in the Middle Magdalena Valley of Colombia.
The companies also created a joint venture to accelerate development of Kappa's Arce oil field and the Bukhara-1 oil discovery.
The farmout agreement, which is subject to approval by state-owned Ecopetrol, obligates Black Rock to spend $3.2 million to earn 50% of Kappa's rights in the Las Quinchas contract. Black Rock will participate in drilling the Arce-3 delineation well and in the workover and extended production testing of Bukhara-1.
Also, Black Rock will either fund the reentry and deepening of an existing wellbore or drill an alternate location to explore deeper Cretaceous reservoirs. The combined work program is targeting light and heavy oil accumulations with potential recovery of up to 120 million bbl of oil.
A workover rig is on site at Bukhara-1. After completing work there the rig will spud the Arce-3 well in mid-May.