CANADIAN oil and gas drilling company Touchstone Exploration’s latest reserves report marks a notable shift in its assessment of Trinidad operations.
Revised estimates show a reduction in natural gas reserves and a stronger focus on crude oil production.
An independent evaluation by GLJ Ltd for the year ending December 31, 2024, published on March 6, valued the company’s total proved plus probable (2P) reserves at approximately US$671 million in future net revenue before tax – an eight per cent decline from the previous year.
President and CEO Paul Baay attributed the decrease partly to a change in reserve calculation methodology.
"The estimates for this year incorporate a material balance assessment based on the data collected at Cascadura," he said. "This approach, compared to the previous volumetric interpretation, aligns reserve estimates with our forecasted production curves."
The company reported a 14 per cent decline in proved reserves to 29,070 Mboe (thousand barrels of oil equivalent) and a 26 per cent drop in 2P reserves to 50,063 Mboe, owing largely to technical adjustments at Cascadura.
Crude oil reserves increased, however, supported by discoveries at Cascadura-3ST1 well and development activities at the WD-4, WD-8 and CO-1 blocks.
Despite the adjustments, Touchstone maintained a producing reserve life index of 8.7 years for 1P reserves and 12.9 years for 2P reserves.
The company also highlighted new opportunities, particularly in its planned expansion of oil drilling in the Rio Claro block.
In 2024, Touchstone completed the Cascadura C pipeline and facility expansion, increasing processing capacity.
The company brought the Cascadura-2ST1 and Cascadura-3ST1 wells into production, contributing to strong fourth-quarter production of 5,287 boe/d (barrels of oil equivalent per day) and an annual average net production of 5,734 boe/d.
Touchstone continued its crude oil development activities, including drilling the CO-374 and CO-375 wells in the CO-1 block.
Cascadura-3ST1 was shut down for 13 days in January as a drilling rig was relocated. Meanwhile, drilling at Cascadura-4 was suspended due to a mud pump failure.
A replacement pump is expected to arrive in Trinidad by mid-March, after which drilling will resume.
Touchstone’s revised reserve figures identify production and technical adjustments.
The company’s 1P net present value discounted at ten per cent (NPV10) fell by five per cent to $354.4 million, while the 2P NPV10 declined by eight per cent to $671 million.
The year-end reserves report does not yet account for Touchstone’s acquisition of Shell Trinidad Central Block Ltd, which provides access to the liquefied natural gas market.
A separate reserves evaluation is expected to be done once the deal is finalised.
Despite declines in gas reserves, the company has maintained its development plans, supported by a total forecasted capital expenditure of approximately $124 million for 1P reserves and $203 million for 2P reserves over the coming years.
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