Expanding gas resource base
In September 2016, Canacol added a second drilling rig in the Lower Magdalena Basin targeting the addition of c 100bcf of recoverable resource to its 2P 390bcf (end 2015) gas reserve base. More gas resource is expected to underpin new sales contracts and a planned increase in productive capacity from 100mmcfd to 190mmcfd. Recent successes at Oboe-1 (28bcf), Nispero-1 and Trombon-1 (Nispero/Trombon combined 40bcf pre-drill) and a five-year rolling 64% exploration success rate gives us confidence in Canacol’s ability to meet its resource expansion target. Management estimates a 2P gas value under long-term contract of US$1.17bn, relative to Canacol’s EV of US$823m (30 June net debt).Canacol Energy is engaged in core petroleum and natural gas exploration and development activities in Colombia, Brazil and Guyana.
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