Abraxas Provides Operational Update
September 19 2017 - 4:10PM
Business Wire
Abraxas Petroleum Corporation (“Abraxas” or the “Company”)
(NASDAQ: AXAS) today provided an operational update. Highlights
include:
- Caprito 98-201H and Caprito 98-301HR
averaged 1,036 and 999 Boepd over each well’s first 30 days of
production, respectively
- Company plans to test 660’ spacing
on four-well pad on Section 99
Delaware Basin
In Ward County, Texas, the Caprito 98-201H, a 4,880 foot lateral
targeting the Wolfcamp A1 zone, averaged 1,036 Boepd (873 barrels
of oil per day, 978 mcf of natural gas per day)(1) over the well’s
first 30 days of production. The Caprito 98-301HR, a 4,880 foot
lateral targeting the Wolfcamp A2 zone, averaged 999 Boepd (838
barrels of oil per day, 962 mcf of natural gas per day)(1) over the
well’s first 30 days of production. Abraxas flowed both wells back
using a more conservative choke management protocol after observing
the practices of offsetting operators. While an uplift compared to
earlier results is expected, its magnitude will not be fully
measurable until the new wells reach maximum pressure drawdown.
Abraxas owns a working interest of approximately 98% in the Caprito
98-201H and 98-301HR.
The completions of the Caprito 83-304H and 83-404H, targeting
the Wolfcamp A2 and Wolfcamp B, respectively, are expected to begin
this week. Abraxas owns a 100% working interest in the Caprito
83-304H and 83-404H. Abraxas is currently drilling the Caprito
82-101H and 82-202H, in which the Company owns a 100% and 62.5%
working interest, respectively. Following these wells, Abraxas
plans to test 660’ spacing at Caprito. The four-well downspacing
test will consist of two Wolfcamp A2 wells and two Wolfcamp A1
wells. With success Abraxas’ assumed well spacing will move from
four wells per section to the industry norm eight wells per section
in the Wolfcamp A1 and A2.
Williston Basin
In McKenzie County, North Dakota, Abraxas recently drilled and
cased a replacement well in the Yellowstone 4HR. The Yellowstone
2H-4HR three-well pad, in which Abraxas owns a 52% working
interest, is scheduled for completion in October. Abraxas recently
spud the first well on the Yellowstone 5H-7H pad in which the
company will hold a 52% working interest.
South Texas/Guidance Update
Abraxas’ producing assets in South Texas sustained no damage as
a result of Hurricane Harvey. Sales volumes were temporarily
reduced due to the shuttering of third party midstream facilities
and Gulf Coast refineries. Wells with associated production of
approximately 700 Boepd were curtailed for a period of one to three
weeks. All wells are now on production and producing at full rates.
Abraxas was also informed that the Company’s scheduled frac date on
the Shut Eye 1H has been postponed to mid-October 2017 as a result
of delays associated with the storm. From mid-August through
September, Abraxas has also been subject to gas curtailments in the
Permian and Bakken due to outages at third party processing and/or
compression facilities. Abraxas has been informed by the respective
third party midstream companies that the outages in the Permian and
Bakken will be resolved this week. In total, Abraxas expects the
curtailments in the Eagle Ford, Permian and Bakken to negatively
impact largely natural gas and NGL production volumes by
approximately 350 Boepd for the quarter. Abraxas is maintaining
yearly average production and exit rate guidance for the year.
Hedging Update
Abraxas recently added additional crude oil hedges for the
remainder of 2017 and 2018. Abraxas’ updated hedging schedule is as
follows:
3Q17 4Q17
2018 2019 Oil Swaps (bbls/day)
2,417 4,063 2,651 1,200 NYMEX WTI (1) $ 54.60 $ 52.82 $ 48.53 $
54.54
WTI Midland / WTI CMA (bbls/day) 500 500
Differential ($/bbl) ($0.65 ) ($0.65 )
Henry Hub Costless
Collar (mmbtu/day) 5,000 5,000 Ceiling ($/mmbtu) $ 3.90 $ 3.90
Floor ($/mmbtu) $ 3.00 $ 3.00
Presentation
Bob Watson, President and CEO of Abraxas, will be presenting at
the Johnson Rice 2017 Energy Conference on September 29, 2017 at
1:30 PM CT. Mr. Watson will also be presenting at the IPAA OGIS
Chicago on October 3, 2017 at 11:00 AM CT. A live webcast of this
presentation can be accessed under the investor relations section
of the Company’s website at www.abraxaspetroleum.com.
Mr. Watson commented, “We are pleased to announce the results
from our first Wolfcamp A1 well in the Caprito 98-201H, which
derisks an additional zone across our acreage position. As a
reminder, we flowed back both the Caprito 98-201H and 301HR on a
more restricted choke in an effort to enhance the long-term well
performance. Despite the fact both wells have yet to flow on more
than a 24/64 inch choke, they continue to outperform our
expectations.
“The fourth quarter of 2017 promises to be busy for Abraxas
operationally. We expect to begin completions on our next Wolfcamp
pad in the Caprito 83-304H and Caprito 83-404H in the next few
days. With success, the Caprito 83-404H will derisk a third zone
for us in the Wolfcamp B. In October, we will attempt our first
modern completion design in the Eagle Ford in the Shut Eye 1H. The
following week we will complete a three well pad in the Bakken on
our Yellowstone unit. Finally, in November, we plan to finish the
year with a two well completion in the Delaware. In total, we plan
to complete and bring six net wells on production in the fourth
quarter. We look forward to what promises to be another step-change
in production.”
(1) The 30-day average rates represent the
highest 30 days of production and do not include the impact of
natural gas liquids and shrinkage at the processing plant and
include flared gas.
Abraxas Petroleum Corporation is a San Antonio based crude oil
and natural gas exploration and production company with operations
across the Rocky Mountain, Permian Basin and South Texas regions of
the United States.
Safe Harbor for forward-looking statements: Statements in this
release looking forward in time involve known and unknown risks and
uncertainties, which may cause Abraxas’ actual results in future
periods to be materially different from any future performance
suggested in this release. Such factors may include, but may not be
necessarily limited to, changes in the prices received by Abraxas
for crude oil and natural gas. In addition, Abraxas’ future crude
oil and natural gas production is highly dependent upon Abraxas’
level of success in acquiring or finding additional reserves.
Further, Abraxas operates in an industry sector where the value of
securities is highly volatile and may be influenced by economic and
other factors beyond Abraxas’ control. In the context of
forward-looking information provided for in this release, reference
is made to the discussion of risk factors detailed in Abraxas’
filings with the Securities and Exchange Commission during the past
12 months.
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version on businesswire.com: http://www.businesswire.com/news/home/20170919006506/en/
Abraxas Petroleum CorporationGeoffrey King, 210-490-4788Vice
President – Chief Financial
Officergking@abraxaspetroleum.comwww.abraxaspetroleum.com
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