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Houston American Energy Corp Highlighted In The Wall Street Journal
By Jennifer Cummings of DOW JONES NEWSWIRES
Colombiabased Petrominerales announced Monday that its Candelilla-2 well in Colombia is now producing more than 15,800 barrels per day. This is the second well into the newly discovered Candelilla structure. The first well, Candelilla-1, has flowed naturally at an average sustained rate of 12,400 barrels per day, Petrominerales said.
It costs about $10 million on average to drill a well in this area, Global Hunter Securities analyst Philip McPherson said. So at the rates the Candelilla wells are producing, a company working in this area could earn back its investment in less than a month, he calculated.
"There's nothing in the U.S. you can drill onshore that will give you that kind of bang for your buck," he said.
Houston American Chief Financial Officer James Jacobs said the company is a 25% stakeholder in an exploration block called CPO 4, which abuts the area Petrominerales is drilling. South Korea's SK Energy Co. (096770.SE) owns the rest of that CPO 4 stake, Jacobs said.
"We're very excited about the prospects we have and about recreating some of the success Petrominerales has had," Jacobs said.
Jacobs said Houston American and SK Energy expect to drill their first well in the CPO 4 stake later this year.
Colombia has become a hot bed for drilling activity as the political situation has been stabilizing in that country in recent years, Global Hunter's McPherson said, noting that there's a lot of "lowhanging fruit" yet to be explored there.
Shares of Houston American were recently up 12% to $9.54, after earlier climbing as high as $9.55, an intraday level above which the stock hasn't traded since July 2008. The stock was trading Tuesday at nearly three times its averagedaily volume.
Meanwhile, U.S.traded shares of Petrominerales recently rose 16% to $25.62. Torontotraded shares of the company were recently up C$3.29, or 14%, to C$26.69.
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