CMS Energy Corporation Discovers Major New Oil Field in Venezuela's Maracaibo Basin

CMS Energy Corporation's oil and gas exploration and production unit, CMS Oil and Gas Company, has made a significant discovery in the Colon Block of western Venezuela's Maracaibo basin. The new oil field is expected to add substantial reserves to the block, which covers approximately 790,000 acres. The exploratory well, La Palma 1X, was drilled to a depth of 10,180 feet and discovered oil at intervals from 8,764 to 8,916 feet in the Mirador formation. The well has been tested at a rate of 5,000 barrels of 28-degree gravity oil per day, with projections of significantly higher production rates after the installation of larger tubing and permanent facilities. This discovery marks a major milestone for CMS Oil and Gas Company, which holds a 43.75 percent interest in the Colon Block and is part of a joint venture exploring and developing the block with Tecpetrol de Venezuela, S.A. and Coparex Latina de Petroleos S.A.

Key Takeaways:

• The La Palma 1X well was drilled to a depth of 10,180 feet and discovered oil at intervals from 8,764 to 8,916 feet in the Mirador formation.
• The well was tested at a rate of 5,000 barrels of 28-degree gravity oil per day, with projections of significantly higher production rates.
• The discovery is expected to add significant reserves to the Colon Block, which covers approximately 790,000 acres.
• CMS Oil and Gas Company holds a 43.75 percent interest in the Colon Block as part of a joint venture with Tecpetrol de Venezuela, S.A. and Coparex Latina de Petroleos S.A.
• The company is among America's 30 largest independent oil and gas companies in production and reserves.
• At the end of 1998, CMS Oil and Gas Company held proven reserves of 182 million net equivalent barrels.

Statistics:

• The Colon Block covers approximately 790,000 acres.
• The La Palma 1X well was tested at a rate of 5,000 barrels of 28-degree gravity oil per day.
• The block is producing approximately 12,200 barrels of oil per day, primarily from the Campo Rosario field.
• CMS Oil and Gas Company holds proven reserves of 182 million net equivalent barrels as of December 1998.
• CMS Energy Corporation has annual sales of about $6 billion and assets of about $14 billion.

Sources:

• CMS Energy Corporation's (NYSE: CMS) press release dated July 1
• PR Newswire (no date mentioned)
• CMS Energy Corporation's annual report for 1998 (no date mentioned)