Ivanhoe Energy said that it has successfully produced oil at its second appraisal well in the Pungarayacu field on Block 20 in Ecuador, following the steam injection operations.

The IP-5b well was drilled, cored and logged to a total depth of 1,080ft, which was then perforated in the Hollin oil sands and steam was injected into the reservoir.

The perforation was then followed by the production of heated heavy oil back to the well bore and to surface.

The oil produced from the IP-5b well will be transported to Ivanhoe Energy’s HTL Feedstock Test Facility at the Southwest Research Institute in San Antonio, Texas.

Independent lab analysis of the oil produced from the IP-5b well indicates an API gravity of approximately 9 to 10 degrees.

The oil demonstrated very favorable viscosity reduction at elevated steaming temperatures and the produced oil also contained dissolved gas, which further enhances its mobility in the reservoir and will positively impact thermal recovery potential.

The Hollin formation has exhibited very favorable reservoir permeabilities and this is the primary sandstone reservoir and principal producing formation in the Oriente Basin.

An independent review completed by Gaffney, Cline & Associates estimated that within the 250sq mile delineated portion of the block, and within the Hollin formation, there are between four to 12 billion barrels of original-oil-in-place.

Production testing at the IP-5b well is continuing and the recently completed steam program was initiated in the Hollin formation at a depth of approximately 750ft.

During the drilling and coring of the well, oil shows also were encountered in the shallower, Napo T-Sand formation at a depth of approximately 540ft.

Ivanhoe Energy plans to commence a seismic program following testing operations at the IP-5b well.