Cana­di­an en­er­gy com­pa­ny Touch­stone Ex­plo­ration says two new oil wells brought in­to pro­duc­tion this month are al­ready de­liv­er­ing im­me­di­ate cash flow, while the com­pa­ny pre­pares for high­er nat­ur­al gas pric­ing dur­ing a ma­jor main­te­nance shut­down at At­lantic LNG.

The com­pa­ny said in a news re­lease on its web­site that the FR-1835 and FR-1836 de­vel­op­ment wells on the WD-8 block were com­plet­ed and brought on­line in mid-May, with com­bined pro­duc­tion av­er­ag­ing about 175 bar­rels per day of medi­um-grav­i­ty crude oil.

Touch­stone pres­i­dent and chief ex­ec­u­tive of­fi­cer Paul Baay said the wells are per­form­ing in line with ex­pec­ta­tions and are ben­e­fit­ing from strong glob­al crude oil prices.

Baay said the drilling pro­gramme was ful­ly fund­ed through the com­pa­ny’s strate­gic ex­change of the Fyz­abad as­set in 2025, which pro­duced about 49 bar­rels of oil per day last year.

At the same time, the com­pa­ny ex­pects im­proved nat­ur­al gas pric­ing as At­lantic LNG Train 4 un­der­goes a sched­uled 54-day main­te­nance shut­down, which be­gan and will con­tin­ue till Ju­ly 19.

Touch­stone said gas vol­umes from its Cen­tral block are be­ing redi­rect­ed to At­lantic LNG Train 2/3 and the do­mes­tic mar­ket dur­ing the out­age pe­ri­od. The com­pa­ny ex­pects the tem­po­rary di­ver­sion to im­prove re­alised gas prices as the pric­ing for­mu­la for Train 2/3 is high­er than Train 4.

The com­pa­ny al­so said do­mes­tic in­dus­tri­al de­mand re­mains strong, dri­ven by petro­chem­i­cal and fer­tilis­er pro­duc­tion, in­clud­ing methanol and am­mo­nia.

Touch­stone is al­so mov­ing ahead with ex­pan­sion work at its Cas­cadu­ra fa­cil­i­ty on the Or­toire block. In­stal­la­tion of a new boost­er com­pres­sor is pro­gress­ing on sched­ule, with com­mis­sion­ing ex­pect­ed to be­gin in June.

The com­pres­sor is in­tend­ed to low­er well­head back pres­sure, ease pipeline con­straints and al­low wells to flow more freely, im­prov­ing pro­duc­tion ef­fi­cien­cy and fa­cil­i­ty re­li­a­bil­i­ty.

At the Cas­cadu­ra field, Touch­stone has an 80-per cent op­er­at­ing work­ing in­ter­est and Her­itage Pe­tro­le­um Com­pa­ny holds the re­main­ing 20 per cent.

Mean­while, the com­pa­ny is prepar­ing a coiled tub­ing cleanout and acid stim­u­la­tion pro­gramme at its Cara­pal Ridge-3 in the Cen­tral Block on­shore in T&T well to im­prove pro­duc­tion per­for­mance. Since first pro­duc­tion, the CR-3 well has been pro­duc­ing about 2.2 mil­lion cu­bic feet of nat­ur­al gas per day and 14 bar­rels of con­den­sate per day.

Touch­stone said reser­voir analy­sis iden­ti­fied a lo­calised in­flow re­stric­tion like­ly caused by resid­ual drilling and com­ple­tion flu­ids.  

The com­pa­ny is wait­ing on the avail­abil­i­ty of a lo­cal coiled tub­ing unit to car­ry out the in­ter­ven­tion pro­gramme.

The sole lo­cal ser­vice provider ca­pa­ble of ex­e­cut­ing the work is cur­rent­ly ad­dress­ing me­chan­i­cal is­sues with its unit and sourc­ing re­place­ment parts.

Touch­stone said it is as­sess­ing whether it would be com­mer­cial­ly ben­e­fi­cial to de­lay the CR-3 op­ti­mi­sa­tion pro­gramme un­til af­ter the At­lantic LNG main­te­nance pe­ri­od ends, giv­en the favourable gas pric­ing en­vi­ron­ment cre­at­ed by the Train Four shut­down.