Touchstone Exploration Inc T.TXP

Comments from North ASA - a TXP major shareholder

[Proselenes]

Comments from North ASA in their Q3 report. Coho early 2022. Cascadura online H1 2022. Royston-1 oil discovery highly significant.

 

https://northenergy.no/wp-content/uploads/2021/11/NE-Interim-report-Q3-2021.pdf
 

Touchstone Exploration Inc.
 

The Company’s key financial investment is in Touchstone Exploration with an ownership interest of 6.0 per cent by the end of the third quarter, up from 5.9 per cent last quarter. During the quarter, the company announced the completion of drilling of the Royston-1 exploration well and the drilling results. The well, which is the deepest exploration well drilled by Touchstone to date, encountered substantial hydrocarbon accumulations. An aggregate of 393 gross feet of hydrocarbon pay was identified in two unique thrusts sheets in the Herrera GR7 and GR7bc sands.

 

The results from Royston-1 exceeded pre-drill expectations, but the extent and commercial assessment of the discovery is pending production testing.

 

After quarter end Touchstone announced the result of the first of three planned production tests of Royston-1, which confirmed a light oil discovery in the lowermost section of the well. The discovery of oil in lower parts of the well within the Herrera sands is very important as it opens up a new oil play that can be developed alongside the targeted gas play in Herrera sands (production test two and three) higher up in the well. Middle Miocene turbidite deposits have historically been prolific producers onshore Trinidad. As highlighted by the company, the Royston-1 well did not target the best sands in the lower intermediate Herrera GR7a sheet and future wells are likely to be optimized to target these sections.

 

A light oil discovery in Royston1 also bodes well for the Krakken well planned for 2022, in which the company intends to target a very large cretaceous turbidite play similar to the Guyana/Suriname discoveries.

 

The company aims to bring the Coho-1 discovery onto production in early 2022. Coho-1 was the first well drilled in the 5-well programme on the Ortoire Block. The company estimates the net future production rate from Coho-1 to be in the range from 1,300 – 1,600 barrels of oil equivalent (boe) per day, which will double the company’s overall production.

 

The two Cascadura wells are targeted for production in the first half of 2022. The company estimates the net future production rate from Cascadura to be in the range of 10,000 – 13,000 boe per day, with additional upside from future development wells.

 

Touchstone expects production from the Ortoire block to increase cash flow significantly and contribute to a substantial reduction in volatility of future earnings. Based on the natural gas sales agreement with the National Gas Company of Trinidad and Tobago, Touchstone has secured offtake for all natural gas produced from the Ortoire license.

.