General Announcement::Canacol Energy Ltd. Provides Gas Sales and Drilling Update

Issuer & Securities

Issuer/ Manager
CANACOL ENERGY LTD.
Securities
CANACOLENE US$500M5.75%281124A - US134808AD63 - PNTB
CANACOLENE US$500M5.75%281124R - USU13518AC64 - YW0B
Stapled Security
No

Announcement Details

Announcement Title
General Announcement
Date &Time of Broadcast
05-Jul-2023 20:00:25
Status
New
Announcement Sub Title
Canacol Energy Ltd. Provides Gas Sales and Drilling Update
Announcement Reference
SG230705OTHRCM84
Submitted By (Co./ Ind. Name)
Canacol Energy
Designation
Canacol Energy
Description (Please provide a detailed description of the event in the box below)
Canacol Energy Ltd. Provides Gas Sales and Drilling Update

CALGARY, ALBERTA (July 5, 2023) - Canacol Energy Ltd. ("Canacol" or the "Corporation") (TSX:CNE; OTCQX:CNNEF; BVC:CNEC) is pleased to provide the following gas sales and operations update.

June Gas Sales of 186 MMscfpd

Realized contractual natural gas sales (which are gas produced, delivered, and paid for) were 186 million standard cubic feet per day for June 2023.

Lulo 2 - Tests 24 MMscfpd

As announced on June 6, 2023, the Lulo 2 appraisal well, located on the 100 percent operated VIM21 Exploration and Production ( E&P ) contract, encountered 230 feet true vertical depth of net gas pay with average porosity of 20 percent within the primary Cienega de Oro ( CDO ) sandstone reservoir. The Lulo 2 well was tied into permanent production and flow tested 24 MMscfpd.

Chimela 1 Basal Lisama tests 353 BOPD

As announced on January 23, 2023, the Chimela 1 exploration well, located on the 100% operated VMM45 E&P contract located in the Middle Magdalena Basin, encountered 85 feet of net oil and gas pay within the Tertiary aged Basal Lisama sandstone reservoir.

The Basal Lisama sandstone reservoir was perforated in various intervals between 13,625 and 13,694 feet measured depth and tested with a jet pump for 62 hours at an average rate of 353 barrels of oil per day ( bopd ) of 23.6 degree API oil. The average water cut during this flow period varied between 2-3% and constant THP (Tubing Head Pressure) of 40 psi was maintained. The well is currently shut in for a build-up period of 20 days.

Once the pressure data has been collected, a development plan will be formulated and executed to rapidly commercialize the Chimela discovery. Chimela is located approximately 7 kilometers from the Acordionero field operated by Gran Tierra Energy. The Acordionero field produces approximately 18,600 bopd from the same reservoirs that have proven productive at Chimela.

Near term drilling plans Pi a Norte, Cereza, and Malfadine near field exploration wells

Canacol s near field exploration program includes the successful Lulo discovery, as well as the Pi a Norte, Cereza, and Malfadine prospects. The program is targeting exploration prospects located close to the Jobo production facility that can be commercialized very quickly, allowing the Corporation to build productive capacity in order to meet the anticipated high demand for gas associated with the upcoming El Ni o phenomena.

The Corporation spud the Pi a Norte 1 exploration well on its 100% operated VIM21 E&P Contract on June 26, 2023. The well is located approximately 500 meters to the west of the Jobo gas treatment facility and is targeting gas charged reservoirs in the CDO sandstone identical to those encountered at the nearby Lulo discovery. The Corporation anticipates that that well will be drilled, completed, and tied into production within the next 3 weeks. If successful, the Corporation will drill the Pi a Norte 2 appraisal well immediately upon completion of the Pi a Norte 1 well.

The Corporation plans to spud the Cereza 1 exploration well, located on its 100% operated VIM21 E&P contract, in early August. The well is located approximately 500 meters to the north of the Jobo production facility, and it also targeting gas charged sandstones of the CDO reservoir. The well will take approximately 3 weeks to drill, complete, and tie into production. If successful, the Corporation will immediately drill the Cereza 2 appraisal well.

The Malfadine 1 exploration well will be the next well to be drilled in the nearfield exploration program, which is located approximately 1.5 kilometers to the northwest of the Jobo production facility. Malfadine 1 is also targeting gas charged reservoirs within the CDO sandstone and will take 3 weeks to drill and complete. If successful, the Corporation will immediately drill the Malfadine 2 and 3 appraisal wells.

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