Coiron Amargo 2nd benchRecently,
Vista Oil & Gas reported its production and testing results from
Bajada del Palo Oeste (slides 15-16
https://www.vistaoilandgas.com/Investor_presentation.pdf)
Bajada del Palo Oeste is directly northwest of
Madalena Energy’s (MVN CN; MDLNF)
Coiron Amargo (see
here, G6), and is home to the same shale formation as contained in Coiron Amargo (currently, in pilot-production drilling phase with Pan-American Energy as JV partner).
According to the presentation, Vista drilled production wells in the formation (La Cocina) and tested a NEW bench (Lower Organic) directly above where wells in the formation have been drilled to-date.
The results of the testing are very positive and expose an entirely new bench, which extends to Madalena’s acreage in Coiron Amargo. Incidentally, as detailed below, there are 5 total potential benches in the formation.
Vista’s testing results indicate that
Madalena’s Coiron Amargo resources of 136mm barrels should be doubled, along with its
NPV (from $1.45bn to $2.9bn). With Coiron Amargo containing ~$3bn of value and Curamhuele reasonably containing $2bn of value, it is not difficult to reach a
100x return for the equity (
excluding all other assets and current production).
Currently, the market is valuing Madalena at
less than 2P reserves with ZERO value for its shale acreage.