Test results at Touchstone Exploration (AIM:TXP) 's Cascadura-1ST1 site have confirmed a significant liquids rich natural gas discovery in the Ortoire exploration block.
The Calgary-based upstream oil and gas firm informed investors that it had encountered a total of 777ft of pay in the Herrera formation, with the first stage testing the lower most 162ft.
Average flow rates were recorded at 5,180 barrels oil equivalent per day (boe/d) over a fourteen-hour test period, including 26.9 million cubic feet per day of natural gas and 694 barrels per day of natural gas liquids.
Touchstone reported a peak flow rate of 5,736 boe/d, including 30.2 million cubic feet per day of natural gas and 710 barrels per day of natural gas liquids.
Paul Baay, President and CEO of Touchstone said the test results were “a dramatic change” for the group, confirming a resource potential the company views as “monumental.”
Shares in Touchstone Exploration reacted positively and were trading 41.53% higher at 41.75p during Thursday trading.
“To put these results in context, our average daily oil production for the three months ended September 30, 2019 was 1,729 bbls/d,” said Baay.
The well is now expected to be shut-in for a two-week pressure build-up test with further testing of pay to follow, the company noted.
This morning's news follows Touchstone’s previous success at the Coho-1 well which exceeded expectations in December last year.
The modelling for final testing of the Coho-1 exploration supports initial gross production rates of around 1,667 to 2,000 boe/d, Baay reiterated, with Cascadura now set to provide “a further step change.”
Looking ahead, Baay added that Touchstone intends to focus on multiple tie-in scenarios in order to maximise economic value at the Ortoire exploration block which, according to the group, continues to “consistently and dramatically” outperform expectations.
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