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Range Resources' Atzam Oil Project Sells More Oil, To Drill New Development Well

Range Resources' (ASX: RRS) Atzam Oil Project in Guatemala has generated further revenue from oil sales and could soon see production increase from the drilling of the Atzam-5 development well.

Operator Latin American Resources (LAR) had this week completed a sales contract of 1,500 barrels of oil to Perenco Guatemala that generated netbacks of about $60 a barrel.

This brings total oil sales since August to 13,000 barrels.

LAR is also preparing to spud the Atzam-5 development well in November that will target the C17 and C18 carbonate sections.

These sections were the original primary targets in the Atzam-4 well and had demonstrated strong oil shows during drilling but were not flow tested.

Atzam-4 currently flows oil at a rate of 140 barrels per day under a restricted choke from a secondary target. Plans are underway to increase production once the storage facilities are installed.

The 20 million barrel Best Estimate Contingent Resource at Atzam is under review following the success of Atzam-4. There is also material exploration upside at the field with an unexplored salt dome and anticline structures to be evaluated and tested in 2014.

Tortugas Salt Dome Project

LAR is also preparing to re-enter the 63-4 and 63-5 wells in the Tortugas Salt Dome structure to the north in early 2014.

These wells had flowed oil at initial rates of over 1,500bpd in the 1970s before they were subsequently suspended and are now expected to produce between 200-300 bpd each of high quality 34 degrees API oil.

Range has a 32% direct and indirect 32% interest in the Guatemalan Project.

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