NG Energy provides development and operational update for Sinu-9 and Maria Conchita

NG Energy International release

CALGARY, AB, June 27, 2024 – NG Energy International Corp. (“NGE” or the “Company”) (TSXV: GASX) (OTCQX: GASXF) is pleased to provide the following operational update, in collaboration with it’s infrastructure partners, INFRAES S.A.S E.S.P and Surenergy S.A.S E.S.P (the “Infrastructure Partners”), on the construction of Phase-1 infrastructure at Sinu-9, as well as provide an update on production optimization at Maria Conchita.

Sinu-9 - Infrastructure Construction

Substantial progress has been made over the past month by the Company and the Infrastructure Partners towards completing the construction of Phase 1 infrastructure at Sinu-9. The Company’s focus has now transitioned to finalizing all processing facilities, following which the pipeline will be connected and fully completed, paving the way for project commissioning.

The remaining activities required to complete the construction of the Phase 1 infrastructure (with expected completion dates) are as follows:

• Brujo Platform and civil works: scheduled for completion by the first week of July;
• Brujo-1X well completion: scheduled for completion by the end of July;
• Brujo-Magico flowline: scheduled for completion by the end of July;
• Pipeline connection equipment installation and completion of the 32 km pipeline (as defined by INFRAES S.A.S E.S.P): scheduled for completion by the end of July (see figure 1); and
• Final equipment shipments from Houston have been ordered and are on the way to site with final installations scheduled for completion by the first week of August.

The Company remains on track to allow for project completion and subsequent production testing and ramp up to begin in Q3, 2024.

Figure 1 – 32 km Pipeline Progress

Figure 2 – Jobo Connection point

Figure 3 – Official delivery point to Promigas

Maria Conchita – Production Optimization

A comprehensive analysis of the compression system at the Maria Conchita production facilities is underway to determine the potential for increasing gas production rates. Further, in July, the H4 zone at Aruchara-3 will be tested to evaluate production potential of the fractured zones. With these activities underway, the Company maintains production at an average rate of 18 MMcf/d with 78% of this production sold under natural gas sales contracts with a term of 3 to 5 years. The balance of the production from Maria Conchita is being sold into the spot market on an interruptible basis.

Brian Paes-Braga, Co-Chairman and Chief Executive Officer, commented, “We’re pleased with the progress made and excited to see our Phase-1 infrastructure at Sinu-9 nearing completion, which once at full production will reach 40 MMcf/d, and will increase our daily net production more than 200%. Admittedly, we acknowledge and are disappointed by the delays that we have faced during Phase-1 at Sinu-9, many of which we believe to be important learnings for our future development of the significantly larger Phase-2 and Phase-3 projects, as we look to speed up development to become the reliable source of natural gas over the next year and beyond as Colombia faces its domestic shortages of up to 300 MMcf/d.[1]  Again, we want to thank all our employees, partners, contractors and the community for their dedication, hard work, perseverance and understanding over the past year as we bring on this critical new source of transition fuel. At the same time, our Maria Conchita field has maintained a steady production rate of 18 MMcf/d, and we're confident in the field’s potential for stable and increased production over the long term. We look forward to evaluating the fractured sections of the H4 zone at Aruchara-3, which will further enhance our production capabilities.”