GeoPark Holdings Limited, the Latin American oil and gas exploration and production company with producing properties in Chile and Argentina, has declared the discovery of a new gas field on the Fell Block in Chile after the successful testing of the Cerro Sutlej-1 exploration well.

The Cerro Sutlej-1 well was drilled on a new structure that had been defined following the interpretation of GeoPark's 3D seismic program performed in 2007.

Following fracture stimulation, the well is currently producing at an approximate rate of 4.3 million cubic feet per day (mmcfpd) and 100 barrels per day (bpd) of liquid (50% condensate) through a choke of 10 milimetres (mm) and with a well head pressure of 1,365 pounds per square inch (psi).

The well is producing from the Springhill formation at a depth of approximately 3025 meters. These are preliminary results and further production history will be required to determine future flow rates and the extent of the reservoir.

Following the successful test, a gas pipeline was immediately constructed tying the well into GeoPark's gas treatment and compression plant. The gas is currently being sold and delivered to the Methanex Corporation at its methanol plant 100 kilometres from the Fell Block. Total time from well test to actual sales was less than two weeks, thereby demonstrating the quick cycle time of many of GeoPark's opportunities on the Fell Block resulting from its infrastructure investments during 2006-2007.

The Cerro Sutlej-1 represents the fifth successful well that GeoPark has drilled and put on production in Chile since its long term drilling program began in June 2007. Two other new wells have tested hydrocarbons but require further testing or remedial operations before being put on stream. One well is waiting for sidetracking operations and two new wells have been drilled and cased and are currently waiting to be tested.

Current gross production from GeoPark's blocks in Chile and Argentina is approximately 3,380 barrels of oil equivalent per day (boepd) with a net production of 2,980 boepd.

In Chile, where GeoPark became the first private-sector oil and gas producer in 2006, GeoPark has been carrying out an aggressive US$100 million capital investment program during 2006 to 2008 to explore for and develop oil and gas in the Magallanes region.

During 2008, GeoPark has a capital investment program of US$57 million in Chile and Argentina, which involves the drilling of 17-20 wells and construction of new production and infrastructure facilities. The program represents a balanced mix of production, development, and exploration projects focused on both increasing oil and gas production and adding new oil and gas reserves.

Tags: Geopark Holdings Ltd.