Trio Petroleum Corp Announces the Restart of the McCool Ranch Oil Field
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The refurbishment and restart of production at McCool Ranch by Trio Petroleum Corp represent a strategic move in the energy sector, particularly within the oil and gas industry. The operational update indicates a positive trajectory for Trio Petroleum's asset utilization and potential revenue generation. The successful refurbishment of the San Ardo Water Disposal Well WD-1 is critical, as water disposal is a key component of oil production, especially in regions with stringent environmental regulations like California. The ability to dispose of water efficiently can lead to cost savings and smoother operations, which in turn can enhance the company's profitability.
Furthermore, the acquisition of a 22% working interest through work commitment expenditures suggests a capital-efficient approach to expanding Trio's portfolio. This method of acquisition could potentially minimize upfront cash outlays and align investment with operational progress. From an investment perspective, this update may signal improved future cash flows and a stronger position within the competitive landscape of the American oil market. However, investors must also consider the volatility of oil prices and regulatory changes that can impact the profitability of such ventures.
The announcement of the restart of the six previously producing wells at McCool Ranch is likely to have a positive impact on Trio Petroleum Corp's market position. By increasing production capacity, Trio is set to enhance its supply capabilities, which could lead to increased market share and influence over regional oil prices. The timing of these operational advancements must be noted, as they come at a period when global energy demands are fluctuating and there is a strong push for renewable energy sources. The market's response to such developments will be contingent upon the prevailing economic conditions and the company's ability to capitalize on the increased production efficiently.
It is also worth considering the potential impact on local economies, such as job creation and increased business for local suppliers. These factors can contribute to a favorable view of the company within the community and among investors who value corporate responsibility alongside financial performance.
From an environmental compliance standpoint, the refurbishment of the San Ardo Water Disposal Well WD-1 is a noteworthy aspect of Trio Petroleum Corp's update. Compliance with environmental regulations is not only a legal requirement but also a significant factor in maintaining a company's social license to operate. The successful testing and refurbishment of the well suggest that Trio is committed to responsible water management, a critical issue in oil production, particularly in drought-prone areas like California.
Investors are increasingly attentive to environmental, social and governance (ESG) factors and Trio's attention to water disposal could positively influence its ESG ratings. This, in turn, could attract investment from funds that prioritize sustainability alongside profitability. In the long term, adherence to environmental standards can mitigate the risk of costly fines and reputational damage. However, the extent of Trio's environmental efforts beyond the disposal well, including its overall carbon footprint and impact on local ecosystems, remains a critical area for investor scrutiny.
Oilfield Fully-Permitted to Restart Production from Six Previously Producing Wells
San Ardo Water Disposal Well WD-1 Successfully Refurbished
and the Testing and Repairs of On-Site Facilities In-Progress
Bakersfield, CA, Jan. 04, 2024 (GLOBE NEWSWIRE) -- Trio Petroleum Corp (NYSE American: TPET) (“Trio” or the “Company”), a California-based oil and gas company, today provided an update on the restart of the McCool Ranch Oil Field (“McCool Ranch”).
On October 18, 2023, the Company announced its acquisition of an approximate
The restarting of McCool Ranch is currently in-progress and is proceeding favorably. The water disposal well at the field, the San Ardo WD-1 well, has been refurbished and tested and is in excellent condition, with water disposal by injection at this well able to commence as soon as needed. The testing and repairs of equipment and facilities, idle since about 2018, are well-advanced and also proceeding favorably. While there was concern that the boiler at the field -- an important piece of equipment that helps maintain the heat of produced oil at an appropriate temperature (e.g., for moving through lines and loading to trucks for delivery to market) -- might require fairly expensive repairs, the Company was able to return it to service at minimal cost and it is now up and running properly and efficiently.
Oil production from the six wells collectively peaked at about 400 barrels per day before the wells were idled in 2015 due to oil prices dropping below
There are three developed areas at McCool Ranch and the Company’s ownership is in the so-called Hangman Hollow Area that is relatively new and developed with four horizontal oil wells, two vertical oil wells, one water-disposal well, one freshwater well, and the capacity to drill approximately an additional 25 wells. In addition, a steam generator, boiler, three 5,000 barrel tanks, a 250 barrel test tank, water softener facilities, two fresh water tanks, two soft water tanks, in-field steam pipelines, oil pipelines and other facilities are installed at the site. The property is fully and properly permitted for oil and gas production, cyclic-steam injection and water disposal and is being restarted after having been idle since about 2015.
The Company’s cash investment in McCool Ranch is primarily allocated to restart production and is expected to establish important cash flow for the Company. The property has significant upside potential with many undrilled infill and development well locations identified. Pictures of McCool Ranch can be found on the Trio website at the following link: https://trio-petroleum.com
The Company believes that current oil prices and other considerations (e.g., approved permits) make this an ideal time to restart McCool Ranch, that the restart is going well, and that the field should soon be providing important cash flow to the Company.
Trio’s CEO, Michael L Peterson, stated: We are pleased with the progress in restarting McCool Ranch and expect that it will soon be providing important cash flow to the Company. We are working hard to deliver on our business plan of building cash-flow to help ensure the success of the Company and to increase shareholder value.
About Trio Petroleum Corp
Trio Petroleum Corp is an oil and gas exploration and development company headquartered in Bakersfield, California, with operations in Monterey County, California. Trio has a large, approximately 9,267-acre asset called the “South Salinas Project” in Monterey County where it owns an
Cautionary Statement Regarding Forward-Looking Statements
All statements in this press release of Trio Petroleum Corp (“Trio”) and its representatives and partners that are not based on historical fact are "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995 and the provisions of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended (the “Acts”). In particular, when used in the preceding discussion, the words "estimates," "believes," "hopes," "expects," "intends," “on-track”, "plans," "anticipates," or "may," and similar conditional expressions are intended to identify forward-looking statements within the meaning of the Acts and are subject to the safe harbor created by the Acts. Any statements made in this news release other than those of historical fact, about an action, event or development, are forward-looking statements. While management has based any forward-looking statements contained herein on its current expectations, the information on which such expectations were based may change. These forward-looking statements rely on a number of assumptions concerning future events and are subject to a number of risks, uncertainties, and other factors, many of which are outside of the Trio's control, that could cause actual results to materially and adversely differ from such statements. Such risks, uncertainties, and other factors include, but are not necessarily limited to, those set forth in the Risk Factors section of the Trio’s S-1 filed with the Securities and Exchange Commission (SEC). Copies are of such documents are available on the SEC's website, www.sec.gov. Trio undertakes no obligation to update these statements for revisions or changes after the date of this release, except as required by law.
Investor Relations Contact:
Redwood Empire Financial Communications
Michael Bayes
(404) 809 4172
michael@redwoodefc.com
FAQ
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