Encore Energy Partners LP Updates Second Quarter 2009 Guidance
June 29 2009 - 6:40AM
Business Wire
Encore Energy Partners LP (NYSE: ENP) (the �Partnership� or
�ENP�) today updated its guidance for the second quarter of
2009.
The Partnership completed the previously announced acquisitions
of oil and natural gas producing properties in the Williston Basin
in North Dakota and Montana from Encore Acquisition Company (�EAC�)
and the purchase of natural gas producing properties in the
Vinegarone Field in Val Verde County, Texas from an independent
energy company for a total combined purchase price of approximately
$53.3 million in cash, subject to customary adjustments. The
updated second quarter guidance includes the impact of these
recently completed acquisitions.
Second Quarter 2009 Guidance Update
The following table displays the Partnership�s updated guidance
for the second quarter of 2009:
� � �
Updated Guidance � � �
Previous Guidance
Average daily production volumes 6,800 to 7,000 BOE/D 6,000 to
6,600 BOE/D Oil and natural gas related capital (second quarter
2009) $2.75 to $3.25 million $2.0 to $3.0 million Maintenance
capital requirements per year (full year) $8.0 to $9.5 million $7.0
to $8.5 million Lease operating expense $11.50 to $12.25 per BOE
$12.50 to $13.50 per BOE General and administrative expenses $4.00
to $4.50 per BOE $3.50 to $4.00 per BOE Depletion, depreciation,
and amortization $18.00 to $18.50 per BOE $18.00 to $18.50 per BOE
Production, ad valorem, and severance taxes 11.8% of oil and
natural gas revenues 11.5% of oil and natural gas revenues Oil
differential (% of NYMEX) -10% of NYMEX oil price -10% of NYMEX oil
price Natural gas differential � dry gas (% of NYMEX) -16% of NYMEX
natural gas price -15% of NYMEX natural gas price
Estimated general and administrative expenses include
approximately $0.7 million in acquisition expenses related to the
previously announced Williston Basin and Vinegarone acquisitions as
well as certain expenses related to the announced acquisition of
properties in the Rockies and Permian Basin from EAC. Such expenses
were not included in the original guidance. Excluding these
expenses, the Partnership�s general and administrative expenses per
barrel of oil equivalent are expected to be below the previous
guidance range.
The estimated average daily production volumes for the second
quarter include 550 to 650 barrels of oil equivalent per day
related to the acquired Williston Basin and Vinegarone properties.
The acquisition of properties from EAC is accounted for as a
transaction between entities under common control. Therefore, the
assets and liabilities of the acquired properties are recorded at
EAC�s historical cost and the historical financial information of
ENP is revised to include the properties for all periods. As a
result, the updated second quarter production volumes, capital, and
expenses shown above incorporate a full quarter of operations of
the Williston Basin properties. Production volumes, capital, and
expenses for the Vinegarone properties are included for the month
of June.
Liquidity Update
At March 31, 2009, ENP had $185 million outstanding under its
revolving credit facility and $55 million of remaining
availability. ENP estimates that as of June 30, 2009, it will have
approximately $195 million outstanding under its revolving credit
facility and $45 million of remaining availability. The amount
outstanding increased during the second quarter of 2009 due to the
purchase of the Vinegarone and Williston Basin properties.
About the Partnership
Encore Energy Partners LP was formed by Encore Acquisition
Company to acquire, exploit, and develop oil and natural gas
properties and to acquire, own, and operate related assets. ENP's
assets consist primarily of producing and non-producing oil and
natural gas properties in the Big Horn Basin in Wyoming and
Montana, the Williston Basin in North Dakota and Montana, the
Permian Basin in West Texas, and the Arkoma Basin in Arkansas.
Cautionary Statement
This press release includes forward-looking statements, which
give ENP's current expectations or forecasts of future events based
on currently available information. Forward-looking statements in
this press release relate to, among other things, expected
production volumes, expected expenses (including lease operating
expenses, general and administrative expenses and depletion,
depreciation, and amortization expenses), expected capital
expenditures, expected taxes, expected differentials, and any other
statements that are not historical facts. The assumptions of
management and the future performance of ENP are subject to a wide
range of business risks and uncertainties and there is no assurance
that these statements and projections will be met. Factors that
could affect ENP's business include, but are not limited to: the
risks associated with drilling of oil and natural gas wells; ENP's
ability to find, acquire, market, develop, and produce new
reserves; the risk of drilling dry holes; oil and natural gas price
volatility; risks associated with derivative transactions
(including the costs associated therewith and the ability of
counterparties to perform thereunder); uncertainties in the
estimation of proved, probable, and possible reserves and in the
projection of future rates of production and reserve growth;
inaccuracies in ENP's assumptions regarding items of income and
expense and the level of capital expenditures; uncertainties in the
timing of exploitation expenditures; operating hazards attendant to
the oil and natural gas business; drilling and completion losses
that are generally not recoverable from third parties or insurance;
potential mechanical failure or underperformance of significant
wells; climatic conditions; availability and cost of material and
equipment; the risks associated with operating in a limited number
of geographic areas; actions or inactions of third-party operators
of ENP's properties; diversion of management's attention from
existing operations while pursuing acquisitions; availability of
capital; the ability of lenders and derivative counterparties to
fulfill their commitments; the strength and financial resources of
ENP's competitors; regulatory developments; environmental risks;
uncertainties in the capital markets; general economic and business
conditions (including the effects of the worldwide economic
recession); industry trends; and other factors detailed in ENP�s
most recent Form 10-K and other filings with the Securities and
Exchange Commission. If one or more of these risks or uncertainties
materialize (or the consequences of such a development changes), or
should underlying assumptions prove incorrect, actual outcomes may
vary materially from those forecasted or expected. ENP undertakes
no obligation to publicly update or revise any forward-looking
statements.
Encore Energy Partners Lp (NYSE:ENP)
Historical Stock Chart
From Jul 2024 to Aug 2024
Encore Energy Partners Lp (NYSE:ENP)
Historical Stock Chart
From Aug 2023 to Aug 2024