Business Context and Reporting Period
This Form 8-K was filed by Houston American Energy Corp. on November 9, 2006. The report provides an update on drilling operations at the Cabiona prospect in Colombia, where the Company holds a 12.5% interest through Hupecol Dorotea and Cabiona LLC (HDC LLC).
Key Financial Metrics
The filing does not provide specific financial data such as revenue, profit, cash flow, margins, debt, or liquidity. The report focuses exclusively on operational milestones and future drilling plans.
Material Changes and Operational Updates
- Cabiona #8 Well Completion: On November 8, 2006, the Cabiona #8 well was completed as an oil well in the C5B Sand at a total depth of 4,348 feet.
- Production Start: The well was turned to production on November 8, 2006, with an initial rate of 1,544 barrels of oil per day (BOPD) from one of three pay sands.
- Production Outlook: Production is expected to increase as the well stabilizes. The electric submersible pump (ESP) is currently running at the lowest possible rate.
- Upcoming Drilling: The drilling rig is moving to drill the Cabiona #11 well, followed by the Cabiona #10 well. Both are expected to be drilled by the end of 2006.
- Long-Term Plan: Hupecol LLC plans to drill 37 wells in Colombia by the end of 2007. The Company holds a 12.5% Working Interest in 22 of these wells and a 1.6% Working Interest in the remaining 15.
Guidance, Risks, and Forward-Looking Statements
The Company plans to update its Colombian activities on a quarterly basis. The report contains forward-looking statements regarding expected production increases from the Cabiona #8 well and the timing of future drilling. Management notes that actual results may differ materially due to risks and uncertainties, and the Company undertakes no obligation to update these statements.
Key Facts for Investor Verification
- Verify the sustained production rate of the Cabiona #8 well as it stabilizes beyond the initial 1,544 BOPD.
- Confirm the successful completion and production start of the Cabiona #10 and #11 wells by year-end 2006.
- Monitor the execution of the 37-well drilling plan through 2007 and the Company's specific working interest percentages in each contract.
- Review future quarterly updates for any changes to the drilling schedule or production expectations.