KLEIN,Et Al PERU Mesozoic Cenozoic Tectonic

1). Published with permission of the Board of Directors of BPZ Resources, Inc. The authors wish to express theirappreciation to Manolo Ziga-Pflcker, President and CEO, BPZ Resources, Inc for facilitating this project.Dr. Victor Benavides-Caceres is thanked for his helpful and cogent review of earlier versions of this manuscript . KellyZuniaga-Lopez is thanked for providing outstanding geotechnical support and drafting. Drafting was also completed byEnrique Bravo. Argelia Rojas and Angelica Rojas are thanked for their excellent clerical support.

MESOZOIC/CENOZOIC TECTONIC EVOLUTION,BASIN FAIRWAYS, AND PLAY OPPORTUNITIES,

PERU1

George Devries Klein2, Fernando J. Ziga-y-Rivero3, Hugh Hay-Roe4,and Estuardo Alvarez-Caldern3

2. SED-STRAT Geosciences Consultants, Inc, 17117 Westheimer Rd, PMB #11,Houston, TX, 77082 ([email protected])

3. BPZ Resources, Inc., 580 West Lake Blvd, Suite 525, Houston, TX, 770794. 3126 Royal Crescent, Kingwood, TX, 77339

SIPES HOUSTON CHAPTER MEETINGSEPTEMBER 15, 2011

QUICK LOOK SUMMARY OF PRIOR PERU GEOLOGYEXPERIENCE AT START OF PROJECT.

Giant Oil and Gas fields in Talara and Madre de Dios basins.

Peru margin is characterized by Oceanic/Continental plate collision with accretionaryprisms.

Peru margin is type area of sediment subduction.

Peru margin is type area for coastal upwelling and development of relatively shallowOxygen-Minimum Zones; serves as global depositional model for source beds.

Coastal basins (like Talara and Tumbes) were forearc basins.

Multiple orogenic events in Andes (as per Steinmann, 1929).

Times of faster spreading rates controlled orogenic events (Pardo-Casas and Molnar,1987).

Peru is a mature oil province.

A captain of an oceanographic vessel needs a hand-stamp to facilitate entry anddeparture at any seaport there.

.. There is nothing like looking at an oldproblem from a new point of view

- Paul E Potter, letter to GDK, January, 1970

..looking at things differently..

- Dick Bishop, HGS Legends Night, January 17, 2011

e.g. Charles Sternbach talk, HGS, April 25, 2011 on GreatAmerican Bank

OUTCOME FROM REAPPRAISAL

Giant Oil and Gas fields in Talara and Madre de Dios basins. Talara 2.1 Billion bblsoil produced 1 Billion more estimated: Camisea 20 Tcf gas.

Peru margin characterized by Oceanic/Continental plate collision with accretionaryprisms. Collision model confirmed; Accretionary prisms disproven from industryseismic and ODP Leg 112 drilling (Slumps).

Peru margin is type area of sediment & crustal subduction. - Confirmed.

Peru margin is type area for coastal upwelling and development of relatively shallowOxygen-Minimum Zones; serves as depositional model for source beds. - Confirmed

Coastal basins (like Talara and Tumbes) were forearc basins. Problematic No Arc orArc Massif (Paleozoic slates instead). No paired metamorphic belts (except in dockedPrecambrian terrane). Sandstone petrology doesnt fit (Marsaglia and Carozzi, 1990).

Multiple orogenic events in Andes (as per Steinmann, 1929). - Confirmed.

Times of faster spreading rates controlled orogenic events (Pardo-Casas and Molnar,1987). - Generally confirmed; plate evolution of Nazca-Farallon plate complicates thisfinding (Lonsdale, 2005).

Peru is a mature oil province. NO - See conclusions.

COMPOSITE TRANSFORM MARGIN: OBLIQUEPLATE CONVERGENCE.

Peru margin is excellent exampleof Composite Transform Margin(cf. Ryan and Coleman, 1992)

This style of margin controlsPerus tectonic evolution.

Oblique convergence appliestorque to overriding plate.

Causes normal faults parallel totrench axis and strike-slip faultsparallel to regional lineaments(cf. Stryon et al, 2011).

(Redrawn from Krabbenhoft et al, 2004 andZuniga y Rivero et al, 2010)

Plate Motion

(Redrawn from Shepherdand Moberly, 1981).

MORPHOTECTONICMAP, NW-CENTRALSOUTH AMERICA.

All but one megashearis Precambrian.

Precambrian megashearscompartmentalizecontinent into separatetectonic zones prone tomajor reactivation,particularly with OBLIQUECONVERGENCE.

Dolores-Guayaquilmegashear is LateK (Maastrichtian) in age.

(Redrawn from Lonsdale, 2005)

REINTERPRETED MAGNETIC ANOMALY MAP, EAST-CENTRAL PACIFIC

Authors note: Abbreviation: F.Z. Fault Zone

This map based onnewly reprocessedmagnetic anomalydata.

(Redrawn from Lonsdale, 2005)

PRESENT-DAY STRUCTURAL FRAMEWORK, EAST-CENTRAL PACIFIC OCEAN.

Authors notes: Abbreviations: MR Mathematicians ridge, VR Viru Rise, CR Clipperton Rise, GR Galapagos Rise, MER Mendoza Rise,EM Easter microplate, M - Mendana fracture zone (East); Marquesas fracture zone (west), C Clipperton fracture zone, G - Guatemala fracture zone,N Nicaragua fracture zone, GA Galapagos fracture zone, V- Viru fracture zone, A (N) Austral fracture zone (west flank) Nazca fracture zone (east Flank).

Major finding fromreprocessed data:Peru margin bounded byFarallon plate; Nazca platereduced in size.

(Redrawn from Bump et al, 2008, andKennan, 2000).

NAZCA PLATE AND ANDEAN KINEMATICS AND CRUSTAL STRUCTURE.

ACTIVE ARC IS MISSING IN ZONE OF FLAT SUBDUCTION

Andes in Flat Subduction zone consists of Paleozoic slate and low-grade metamorphics.

(Redrawn and updated from Hampel, 2002,and Ziga y Rivero et al, 2010)

SEISMICITY AND ACTIVEVOLCANOES, PERU

Deep earthquakes are inboardalong zone of flat subduction.

Flat subduction caused byoblique angle of subductedNazca Ridge since 11 ma.

Volcanoes absent in zone offlat subduction.

(Redrawn from Couch and Whitsett, 1981).

INTERNAL CRUSTAL STRUCTURE WITH FREE-AIR ANOMALY, NAZCA RIDGE

EXPLANATION

Observed Anomaly _______Inferred Anomaly _ _ _ _ _Computed Anomaly o o o o oDensity of Layers on gm/cm2

(Redrawn from Rosenbaum et al, 2005)

FAULT BLOCKSREPLICATEFAULT PATTERNIN TALARA BASINSUBSURFACE.

(Redrawn from Ziga y Rivero et al, 2010)

PERU BORDERLAND SHOWING FRACTURE ZONES AND THEIRLANDWARD EXTENSION

STRUCTURE MAP, EASTPORTOCHEULA FIELD, TALARABASIN; TOP OF SALINA SAND#13

(Redrawn from Ziga y Rivero et al, 2010: per H.Hay-Roe; IPC).

RIBIANA SURVEY LINE 93-16


Accretionary prism and associated thrust faults are missing.

(Redrawn and modified from Benavides-Cceres,1999).

MAJOR TECTONIC UNITS,PERU

Maranon FTB occurs on eastflanks of Western Cordilleran.

Sub-Andean FTB occurs oneast side of Eastern Cordillera.

(Redrawn from Jacques, 2003b)

REGIONAL DISTRIBUTION OF FORELAND BASINS EAST OF THE ANDES ANDASSOCIATED PETROLEUM SYSTEMS, WESTERN SOUTH AMERICA

GUIANASHIELD

Major Precambrian megashears of South Americacompartmentalize foreland basin belt, each withseparate and distinct petroleum systems.

AMBO SOURCE: (MISSISSIPPIAN)VERY GOOD OIL SOURCE ROCK WITHLOCAL OIL POTENTIAL.COMMON T.O.C. VALUES >10%SOURCE OFCAMISEA AND PROBABLEAGUAYTIA GAS FIELDS

REGIONAL ZONATION OFPETROLEUM SYSTEMS ANDSOURCE BED AGES INPERUVIAN FORELANDBASINS.


Age zonation of petroleumsystems occurs on a morelocal scale as well.

Pisco-AbancayMegashear


TECTONIC CORRELATION DIAGRAM, NAZCA & FARALLON PLATES AND ANDES. PERU

ssspreading rate is faster (Pardo-Casas and Molnar, 1987)

TABLE 2. GEOCHRONOLOGICAL AGE OF MAJOR OROGENIC EVENTS, ANDESMOUNTAINS, PERU1

OROGENICEVENT

GEOCHRONOMETRICAGE

GEOLOGIC AGE/STAGE

Quechua 4 2.0 16. Ma Late Pliocene to Early Pleistocene

Quechua 3 5 - 4 Ma Early-Middle Pliocene

Quechua 2 8 - 7 Ma Upper Miocene (Tortonian)

Quechua 1 20.5 12.0 Ma Early and Middle Miocene (Berdigalianthrough Serravallian)

Inca 4 22 Ma Upper Oligocene (Chattian)

Inca 3 30 - 27 Ma Late Early to Early Late Oligocene (Rupelianand Chattian

Inca 2 43 42 Ma Middle Eocene (Lutetian)

Inca 1 59 55 Ma Late Paleocene to Early Eocene (Thanetian toYpresian)

Peruvian 84 - 79 Ma. Late Cretaceous (Santonian to Campanian)

Mochica 100 95 Ma Late Cretaceous (Late Albian to Cenomanian)

1. From Ziga y Rivero et al, 2010;. Ages from Benavides-Cceres (1999), Mgard(1984), Noble et al (1974), McKee and Noble (1982). See also, Klein et al (2011) Search &Discovery #10332

CORRELATION DIAGRAM CONFIRMS CLOSE

TECTONIC LINKAGE OF THE COMBINED

NAZCA-FARALLON PLATES AND THE

EVOLUTION OF THE ANDES.

Perus Petroliferous Basins


MESOZOIC/CENOZOICSEDIMENTARY BASINS,PERU

Outer Shelf and Upper Sloperidges separate the majorcoastal basins.

KEY ISSUES CONCERNING SEDIMENTARY BASINS OF PERU:

Absence of volcanic arc and arc massif in flat-subduction region.

Absence of paired metamorphic belts in Peru (Except for Precambrian blocks).

Dominant fault style is extensional and strike-slip, except for fold-and-thrust beltsflanking western and eastern Cordillera.

So-called forearc basins are absent in flat-subduction region.

Instead, these basins are Extensional/Pull-apart basins formed inresponse to oblique subduction associated with a compositetransform margin and reactivation along Precambrian lineaments. Classifiedaccording to FAULT STYLES.

Intermontane areas contain basins formed by normal and secondary strike-slipfaults.

Foreland basins east of Andes are Cenozoic and are characterizedby polyhistory, the latest stages involving flexural subsidence in responseto the Incaic and Quechua orogenies.

MAP OF BASINFAIRWAYS

OF PERU

(Redrawn from Ziga y Rivero et al,2010)

Major tectonic zones of Perudefine separate basinfairways characterized bydistinct basin formingprocesses.

Aids in narrowing prospectivebasins.

BASINS Oil Gas COMMENTS

ALL BASINS IN FAIRWAY (est.Reserves and Resources)

18 BBO

1P ~ 0.25 BBO2P ~ 0.08 BBO3P ~ 1.1 BBO

47 TCF

1P ~ 1 TCF2P ~ 1 TCF3P ~5.3

TCF

Optimistic (Zuniga et al, 2010, p.41)

Peru Min. Energy & Mines (2008):

Talara basin (total production) 2.1 BBO 10.5TCF

Production from 2% of basinarea; Drilling only in 10% of NEpart of basin

Tumbes basin (est. Reserves Netherland & Sewell (BPZ SEC Filing,6.30.2011)

1P- 38.9MMBO

? Corvina Field 29.2 MMBO(1P)Albacora Field - 9.7 MMBO (1P)PRODUCTION TO DATE: 12.2 MMBORemain reserves -25.3 MMBO

Lancones basin (Est.Resources)

189-392MMBO

Sechura basin (daily production) ? 10 mmcf/day

Trujillo basin (GCA, 2005) 400 MMBO

Salaverry basin (GCA,2005) Lo 50; Med 250; Hi 550 MMBO

Lead stage.

ESTIMATED RESERVES/RESOURCES & PRODUCTION SUMMARIES EXTENSIONAL/PULL-A-PART BASIN FAIRWAY

Additional Source: Zuniga-y-Rivero et al, 2010

ILLUSTRATIVE RANGES OF ESTIMATED RECOVERABLE OIL VOLUMES(Gaffney, Cline & Assoc, 2005; in MMBO)

BASIN LOW MEDIUM HIGHTrujillo-Salaverry-Sechura 50 250 500

Tumbes 25 50 75Talara 25 50 75Pisco 100 200 350

COMMENTS:

1). Numbers are CONSERVATIVE, except for Pisco basin.

2). Booked reserves in Corvina and Albacora fields, Tumbes basin,fall in medium range. In future, could be higher.

ESTIMATED RESERVES/RESOURCES & PRODUCTION SUMMARIES FORELAND BASIN FAIRWAY

BASINS Oil Gas COMMENTS

Maranon basin 2.25-2.5 BBO

Peru Min. Energy & Mines(2008):

1P ~ 274 MMBO2P ~ 391 MMBO3P ~ 838 MMBO

19 TCF Cum Production 900 MMBO32,000 bpd; 290 Mmcf/d

Ucayali basin(potential)

3-6 BBOPeru Min. Energy &Mines (2008):1P ~ 2.5 MMBO2P ~ 1.0 MMBO3P ~ 555 MMBO

16 TCF

1P ~ 0.172TCF2P ~ 0.81TCF3P- ~0.6 TCF

Cum Production 32 MMBO;0.3 TCF

Madre de Dios basin:CAMISEA GAS FIELD

Madre de Dios (All)

600 mmblc

Peru Min. Energy &Mines (2008):

1P ~ 0; 2P ~0; 3P ~101MMBO

1P ~ 653; 2P~ 245; 3P~ 306MMBC

1P~ 653;2P~ 245; 3P ~194MMBNGL

14 TCF

1P ~ 11 TCF2P ~ 3.9 TCF3P ~ 3.5 TCF

Cum Production 1.2 TCF;10 MMBO

Basin Potential: 20 TCF3-4 BBc

600-900 MBO

Additional source: Zuniga-y-Rivero et al, 2010

TABLE 4. FUTURE PLAYS AND OPPORTUNITIES, PERU

PLAY RATIONALE

Extensional/Wrench System Play. Peru Margin is a composite-transform margin characterized byoblique convergence. Traps associated with normal, gravity,and strike-slip faults, and rollover anticlines.

Incised Valley/Shelf Edge Delta/Canyon FillPlay

Well developed incised valley and submarine canyon fills inSeismic cross-lines (between 6o and 15o S Latitude); Shelf edgedelta clinoforms; Shingled submarine fans.

Inboard Foreland Basin Play. Major oil and natural gas exploration play in South America.Hydrocarbon migration and production in play enhanced by astrong tectonically-driven water drive following Incaic orogeny.

Outer Foreland Basin Play. In east side of foreland basins. Play influenced by a gravity-driven water drive from Andes which enhanced migrationfollowing the Quechua orogeny.

Missed Attic Opportunity. Older fields, especially in Talara basin, likely contain unknownvolumes of by-passed oil. (Petrobras testing this now)

Post-Mortem Opportunities from PastDrilling Failures.

Opportunities during past drilling were missed by inappropriatewell locations despite presence of DHIs. Re-evaluationpresents potential opportunity.

Re-evaluating Proposed Leads Developed byPerupetro and Associated Contractors.

Leads and prospects identified by consulting teams to PeruGovernment during past ten years remain to be drilled.

(From Sternbach et al, 2010)

LINKED CANYON-FAN-DEEPWATER PLAY, TRUJILLO BASIN


PROPOSED CANYON/FAN LOCATION DOWN-DIP FROM MORSA 1-X Well

(Redrawn from Barson, 2002)

INNER FORELAND BASIN PLAYTECTONIC FLUID EXPULSIONDRIVES MIGRATION

TECTONICWATERDRIVE

INCAIC OROGENY

CAMISEA FIELD, MADRE DE DIOS BASIN, 3-D SEISMIC DISPLAYAND CROSS-SECTION

(Redrawn from Luquez and Disalvo, 2004,and Ziga y Rivero et al, 2010)

(Redrawn from Barson, 2002)

OUTER FORELAND BASIN PLAY

GRAVITY-DRIVEN FLUID DRIVEENHANCES MIGRATION

QUECHUA OROGENY

Traps exist.Morsa 1Xmissed highon amplitudeanomaly.

Potentialfault trapsevident

(Redrawn from PARSEP, 2001).

SEISMIC LINE 96-69 THROUGH MORSA 1X WELL, TRUJILLO BASIN SHOWINGMISSED OPPORTUNITIES.


PROPOSED CANYON/FAN LOCATION DOWN-DIP FROM MORSA 1-X Well

CONCLUDING COMMENTS:

Continental tectonics is influenced extensively by the tectonicsof adjacent ocean margins and plates.

Reappraisal of tectonic and basin evolution demonstrates thatPeru is still an unexplored country with major explorationopportunities waiting to be drilled.

New basin classification and associated Basin Fairway Conceptyields new opportunities for exploration.

Best opportunities occur in the Coastal Extensional/Pull-Apart basinfairway and the Foreland basin fairway.

http://www.walterwust.com/index.php?galerialibros=1571 OR

ONLINE OVERVIEWPAPER:

Klein, G.D, Zuniga yRivero, F.J., Hay-Roe, H.,Alvarez-Calderon, E,2011, A Reappraisalof the Mesozoic/CenozoicTectonics andSedimentary Basins ofPeru: AAPG,Search and DiscoveryArticle #10332

PRODUCTS FROM ANALYSIS.BOOK:

BPZ E & P SRI, Av. El Derby 055, Urb. Lima Polo and Hunt Club, Edificio Cronos - Torre 1, int 402, Santiago de Surco Lima, Peru Tel: (011-511) 708-0808 (Houston #. 281-556-6200)

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KLEIN,Et Al PERU Mesozoic Cenozoic Tectonic