Eurocan Ventures Ltd., Dubai, has acquired a 25% working and equity interest in a producing concession in Colombia from Saba Energy Inc. The transaction is valued at $3.65 million.
Eurocan, an affiliate of International Petroleum Corp. (IPC), Vancouver, will finance the deal partly through issue of more shares in Eurocan. IPC held 23.5% of Eurocan prior to the acquisition. Saba is a privately held company in Alberta. The deal covers the Las Monas concession in Colombia's Middle Magdalena Valley.
It contains two producing oil fields, Payoa and La Salina. Combined proved and probable reserves are estimated at 7.84 million bbl and 12.7 million bbl, respectively. Combined proved gas reserves are pegged at 74 bcf.
The concession produces an average 3,565 b/d of crude oil, 25 MMcfd of gas, and 1,333 b/d of natural gas liquids, or about 8,000 b/d of oil equivalent in all.
Eurocan sees the deal as economic based on a world oil price of $17-20/bbl. If current oil prices are maintained, that will considerably reduce its payback period, the company said.
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