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Pacific Rubiales eyes heavy oil market in Mexico following Colombia success

14th August 2014

Pacific Rubiales, the Canadian-registered Latin America focussed oil and gas company, has reported production and sales growth in the first half of this year, praising its enhanced oil recovery technology in Colombia and speculating on possible Mexico expansion

Pacific Rubiales eyes heavy oil market in Mexico following Colombia success
Pacific believes that it can repeat its Colombian heavy-oil success in the new Latin American growth market

"Despite challenging operating conditions during the quarter, the company is proud to have achieved a record second quarter with all operational and most of our financial metrics at record levels,” said Ronald Pantin, Pacific Rubiales CEO. “Year to date, the company has generated over USD 2.63bn in revenues and USD1.43bn in adjusted EBITDA.”

Net production of over 149 Mboe/d represented a 17 per cent year-on-year growth for the company. This was achieved despite unusually wet weather hampering production at the company’s flagship Rubiales field in Colombia.

"We continue to advance the diversification of our production beyond the Rubiales field through a combination of strategic acquisitions and organic growth. Our net light oil production in the current quarter has grown to approximately 50 Mbbl/d and 26 fold from three years ago. We expect continued growth in light oil production from our exploration and development assets in Colombia and Peru.”

The report comes at a strategic time as Latin America focussed oil and gas companies eye Mexican exploration and production following this week’s game-changing energy bill.

"Our plans for Mexico continue to advance. We have now secured an office in the country and are very encouraged by what we see for both exploration and development opportunities. The company has a particular skill and knowledge set that can be applied to Mexico's heavy oil exploitation, which will be to the benefit of both Pacific Rubiales and the country.”

Pacific believes that it can repeat its Colombian heavy-oil success in this new Latin American growth market.

"The company continues to progress its enhanced oil recovery technology (STAR) designed to significantly increase recovery factors in Colombia's unique heavy oil fields. Under primary flow techniques, we and other producers are leaving 85 per cent or more of a massive oil resource behind in the ground.

“Increasing the recovery and extending field life of heavy oil through advancing technology is clearly a large potential value creator for Colombia. The company's patented STAR technology has been successfully demonstrated in a relatively small pilot test area in the Quifa SW field, achieving an estimated doubling of the recovery factor, as certified by three independent engineering firms. We have presented a plan to Ecopetrol S.A., our partner in the Quifa SW and Rubiales fields, to expand STAR to a commercial scale.”

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