CALGARY, Jan. 16, 2018 /CNW/ - Enerplus Corporation
("Enerplus" or the "Company") (TSX & NYSE: ERF) today announced
that production for the fourth quarter of 2017 was approximately
88,600 BOE per day, above its fourth quarter guidance range of
86,000 to 88,000 BOE per day, and an increase of 12% from the third
quarter of 2017. The Company's crude oil and natural gas liquids
production averaged approximately 46,750 barrels per day in the
fourth quarter, also above its fourth quarter guidance range of
45,000 to 46,000 barrels per day of crude oil and natural gas
liquids, and an increase of 20% from the third quarter of 2017.
The production outperformance in the fourth quarter was driven
in part by higher than forecasted North
Dakota volumes which averaged approximately 35,500 BOE per
day, representing a 70% increase from the first quarter of 2017.
Strong unrestricted Marcellus production in November and December
in response to improved realized natural gas prices also helped
support fourth quarter volumes. Marcellus production averaged
approximately 193 MMcf per day in the fourth quarter, which takes
into account 35 MMcf per day of price related production
curtailments during the month of October.
Further information regarding the fourth quarter 2017 results
will be provided on February 23,
2018, when the Company releases its fourth quarter and
full-year 2017 results.
Expected Cash Refund and Other Impacts of U.S. Tax
Changes
On December 22, 2017, the United States (U.S.) enacted the Tax Cuts
and Jobs Act ("Tax Legislation"), significantly revising the U.S.
federal income tax law affecting Enerplus' U.S. subsidiary,
Enerplus Resources (USA)
Corporation. With approximately 80% of Enerplus' current production
originating from its U.S. assets, the Company expects that these
changes will positively impact its future after-tax earnings,
primarily due to the lower federal statutory tax rate (now 21%).
The Tax Legislation also repealed the corporate Alternative Minimum
Tax ("AMT") for tax years beginning January
1, 2018, and provides that existing AMT credit carryovers
are refundable beginning in 2018. Enerplus expects to realize a
refund of approximately US$85 million
between 2018 and 2021 related to its current AMT credit carryovers.
Furthermore, Enerplus Resources (USA) Corporation does not have any foreign
subsidiaries and therefore the one-time repatriation of accumulated
foreign earnings under the Tax Legislation does not apply.
The majority of the Tax Legislation changes are effective
January 1, 2018; however, the Company
is required to recognize the effect of certain changes to its
income tax expense in the period the Tax Legislation was enacted.
Accordingly, Enerplus currently anticipates the impact of these
changes will result in an increase to its income tax expense
(reported on its Consolidated Statements of Income/(Loss) and Other
Comprehensive Income/(Loss)) of between C$40 to C$60
million, with a corresponding decrease to its deferred
income tax asset (reported on its Consolidated Balance Sheets) for
the quarter ended December 31,
2017.
The ultimate impact of the Tax Legislation may differ from these
estimates, due to, among other things, changes in interpretations
or assumptions Enerplus has made or the announcement of any
additional regulations or guidance relating to this
legislation. Enerplus expects to provide an update regarding
the impact of the Tax Legislation when it releases its fourth
quarter and full-year 2017 results.
About Enerplus
Enerplus Corporation is a responsible
developer of high quality crude oil and natural gas assets in
Canada and the United States committed to creating value
for its shareholders through a disciplined capital investment
strategy.
Currency and Accounting Principles
All amounts in
this news release are stated in Canadian dollars unless otherwise
specified.
Barrels of Oil Equivalent
This news release also
contains references to "BOE" (barrels of oil equivalent). Enerplus
has adopted the standard of six thousand cubic feet of gas to one
barrel of oil (6 Mcf: 1 bbl) when converting natural gas to BOEs.
BOEs may be misleading, particularly if used in isolation. The
foregoing conversion ratios are based on an energy equivalency
conversion method primarily applicable at the burner tip and do not
represent a value equivalency at the wellhead. Given that the value
ratio based on the current price of oil as compared to natural gas
is significantly different from the energy equivalent of 6:1,
utilizing a conversion on a 6:1 basis may be misleading.
Presentation of Production Information
Under U.S.
GAAP oil and gas sales are generally presented net of royalties and
U.S. industry protocol is to present production volumes net of
royalties. Under Canadian industry protocol oil and gas sales and
production volumes are presented on a gross basis before deduction
of royalties. In order to continue to be comparable with its
Canadian peer companies, unless otherwise stated, the information
contained within this news release presents Enerplus' production
and BOE measures on a before royalty company interest basis. All
production volumes presented herein are reported on a "company
interest" basis, before deduction of Crown and other royalties,
plus Enerplus' royalty interest.
FORWARD-LOOKING INFORMATION AND STATEMENTS
This news release contains certain forward-looking
information and statements ("forward-looking information") within
the meaning of applicable securities laws. The use of any of the
words "expects", "anticipates" and similar expressions are intended
to identify forward-looking information. In particular, but without
limiting the foregoing, this news release contains forward-looking
information pertaining to the expected impact of the U.S. Tax
Reform Legislation on the Company's future after-tax earnings,
deferred income tax expense in the fourth quarter of 2017, and
expected AMT refund.
The forward-looking information included in this news release
is not a guarantee of future performance and should not be unduly
relied upon. Such information involves known and unknown risks,
uncertainties and other factors that may cause actual results or
events to differ materially from those anticipated in such
forward-looking information including, without limitation: changes,
including future decline, in commodity prices; changes in realized
prices for Enerplus' products; changes in the demand for or supply
of Enerplus' products; unanticipated operating results, results
from Enerplus' capital spending activities or production declines;
curtailment of Enerplus' production due to low realized prices or
lack of adequate infrastructure; changes in tax or environmental
laws, royalty rates or other regulatory matters including any
additional regulations or guidance associated with the Tax
Legislation; changes in development plans by Enerplus or by third
party operators of Enerplus' properties; increased debt levels or
debt service requirements; Enerplus' inability to comply with
covenants under its bank credit facility and senior notes; changes
in estimates of Enerplus' oil and gas reserves and resources
volumes; limited, unfavourable or a lack of access to capital
markets; increased costs; a lack of adequate insurance coverage;
the impact of competitors; reliance on industry partners; failure
to complete any anticipated acquisitions or divestitures; and
certain other risks detailed from time to time in Enerplus' public
disclosure documents (including, without limitation, those risks
identified in its AIF, management's discussion and analysis, and
Form 40-F at December 31,
2016).
Follow @EnerplusCorp on Twitter at
https://twitter.com/EnerplusCorp.
Ian C. Dundas
President & Chief Executive Officer
Enerplus Corporation
SOURCE Enerplus Corporation