Bellatrix Announces Planned Timing of Its 2019 Guidance Release, Market Diversification Benefits, Debt Refinancing Update and...
December 07 2018 - 8:04AM
Bellatrix Exploration Ltd. (“Bellatrix” or the “Company”) (TSX,
NYSE: BXE) announces the planned timing of its 2019 capital budget
and guidance release, reiterates its commodity price risk
management protection and market diversification exposure, provides
an update regarding its ongoing debt refinancing efforts, and the
publication of its annual corporate responsibility report.
2019 Capital Budget and Guidance
Timing
Bellatrix plans to release its 2019 capital
budget and guidance in January 2019. The Company intends on
balancing financial flexibility and profitable resource
development, incorporating the benefits of the market
diversification contracts as outlined below.
Reiterated Commodity Price Risk
Management Protection and Market Diversification
Benefits
Bellatrix entered into a series of market
diversification contracts approximately one year ago that give the
Company access to non-AECO market natural gas prices.
Bellatrix’s market diversification sales into the Dawn, Chicago and
Malin markets represent approximately 55% of Bellatrix’s natural
gas volumes (based on the mid-point of 2018 average production
guidance). Each of these three markets has demonstrated material
price improvement in concert with strengthening Henry Hub
prices. Accessing premium priced markets on more than half of
Bellatrix’s natural gas volumes provides a unique and
differentiated advantage in the current price environment.
Furthermore, Bellatrix has proactively fixed the
prices on a portion of these markets to reduce the impact of
commodity price volatility on our business. As at November
30, 2018 Bellatrix has locked in fixed prices in December 2018
(approximately 30% of natural gas volumes based on current annual
2018 production guidance at a Canadian equivalent price of
approximately $4.33/Mcf) and the first quarter of 2019
(approximately 20% of natural gas volumes at a Canadian equivalent
price of approximately $4.20/Mcf) as follows:
Month(s) |
Market |
Quantity |
US$/MMBtu Price |
Net Cdn$/Mcf Price(1) |
Dec
2018 |
NYMEX/Dawn/Chicago Avg. |
50,000 MMBtu/d |
US$4.59/MMBtu |
$4.33/Mcf |
Jan –
Feb 2019 |
NYMEX/Dawn Avg. |
30,000 MMBtu/d |
US$4.64/MMBtu |
$4.40/Mcf |
Mar 2019 |
Malin/Dawn Avg. |
30,000 MMBtu/d |
US$4.19/MMBtu |
$3.78/Mcf |
Note (1): Net Canadian equivalent price is calculated
as the US$ fixed price, less contracted differential, adjusted to
Canadian dollars at an assumed exchange rate of $1.30 USD/CAD. |
In summary, Bellatrix ’s market diversification
contracts include a total of 75,000 MMBtu/d of market exposure as
follows:
Product |
Market |
Start
Date |
End
Date |
Volume |
Natural gas |
Chicago |
February 1, 2018 |
October 31, 2020 |
15,000 MMBtu/d |
Natural gas |
Chicago |
November 1, 2018 |
October 31, 2020 |
15,000 MMBtu/d |
Natural gas |
Dawn |
February 1, 2018 |
October 31, 2020 |
15,000 MMBtu/d |
Natural gas |
Dawn |
November 1, 2018 |
October 31, 2020 |
15,000 MMBtu/d |
Natural gas |
Malin |
February 1, 2018 |
October 31, 2020 |
15,000 MMBtu/d |
|
Debt Refinancing Update
Bellatrix completed a debt refinancing
transaction in September 2018 pursuant to which approximately
one-third of its outstanding 8.5% senior unsecured notes due 2020
(the “2020 Notes”) were exchanged for new 8.5% second lien notes
due 2023 (the “Second Line Notes”). As part of the transaction, the
exchanging noteholders agreed to allow the issuance of up to US$50
million of additional Second Lien Notes, to be used for future 2020
Note exchanges on or before December 31, 2018. The holders of the
Second Lien Notes have agreed to extend the December 31, 2018
deadline for the issuance of such additional Second Lien Notes to
February 28, 2019.
Corporate Responsibility Report
Released
Bellatrix is dedicated to achieving industry
leading economic results in an environmentally responsible,
compliant and safe manner. Bellatrix has released its third
annual Corporate Responsibility Report which has been posted to our
website at www.bxe.com. The report content is designed to
provide context around our corporate responsibility initiatives and
represents an extension of our ongoing commitment to providing
enhanced disclosure and stakeholder engagement.
Bellatrix Exploration Ltd. is a publicly traded
Western Canadian based growth oriented oil and gas company engaged
in the exploration for, and the acquisition, development and
production of oil and natural gas reserves, with highly
concentrated operations in west central Alberta, principally
focused on profitable development of the Spirit River liquids rich
natural gas play.
For further information, please contact:
Steve Toth, CFA, Vice President, Investor
Relations & Corporate Development (403) 750-1270
Bellatrix Exploration Ltd.1920,
800 – 5th Avenue SWCalgary, Alberta, Canada T2P 3T6Phone: (403)
266-8670Fax: (403) 264-8163www.bxe.com
FORWARD LOOKING STATEMENTS: Certain information
contained in this press release may contain forward looking
statements within the meaning of applicable securities laws. The
use of any of the words "continue", "intend", “plan”, “propose” and
similar expressions are intended to identify forward-looking
statements. More particularly and without limitation, this document
contains forward-looking statements concerning plans to release its
2019 capital budget and guidance in January 2019 and the intention
on balancing financial flexibility and profitable resource
development, incorporating the benefits of the market
diversification contracts. To the extent that any
forward-looking information contained herein constitute a financial
outlook, they were approved by management as at the date of this
press release and are included herein to provide readers with an
understanding of the anticipated funds available to Bellatrix to
fund its operations and readers are cautioned that the information
may not be appropriate for other purposes. Forward-looking
statements necessarily involve risks, including, without
limitation, risks associated with oil and gas exploration,
development, exploitation, production, marketing and
transportation, loss of markets, volatility of commodity prices,
currency fluctuations, imprecision of reserve estimates,
environmental risks, competition from other producers, failure to
meet the conditions for closing the acquisition, inability to
retain drilling rigs and other services, incorrect assessment of
the value of acquisitions, failure to realize the anticipated
benefits of acquisitions and dispositions, delays resulting from or
inability to obtain required regulatory approvals, actions taken by
the Company's lenders that reduce the Company's available credit
and ability to access sufficient capital from internal and external
sources. Events or circumstances may cause actual results to differ
materially from those predicted, as a result of the risk factors
set out and other known and unknown risks, uncertainties, and other
factors, many of which are beyond the control of Bellatrix. In
addition, forward looking statements or information are based on a
number of factors and assumptions which have been used to develop
such statements and information but which may prove to be incorrect
and which have been used to develop such statements and information
in order to provide shareholders with a more complete perspective
on Bellatrix's future operations. Such information may prove to be
incorrect and readers are cautioned that the information may not be
appropriate for other purposes. Although the Company believes that
the expectations reflected in such forward looking statements or
information are reasonable, undue reliance should not be placed on
forward looking statements because the Company can give no
assurance that such expectations will prove to be correct. In
addition to other factors and assumptions which may be identified
herein, assumptions have been made regarding, among other things:
the impact of increasing competition; the general stability of the
economic and political environment in which the Company operates;
the timely receipt of any required regulatory approvals; the
ability of the Company to obtain qualified staff, equipment and
services in a timely and cost efficient manner; drilling results;
the ability of the operator of the projects which the Company has
an interest in to operate the field in a safe, efficient and
effective manner; the ability of the Company to obtain financing on
acceptable terms; field production rates and decline rates; the
ability to replace and expand oil and natural gas reserves through
acquisition, development of exploration; the timing and costs of
pipeline, storage and facility construction and expansion and the
ability of the Company to secure adequate product transportation;
the ability for all parties to satisfy all conditions for closing
the acquisition; future commodity prices; currency, exchange and
interest rates; the regulatory framework regarding royalties, taxes
and environmental matters in the jurisdictions in which the Company
operates; and the ability of the Company to successfully market its
oil and natural gas products. Readers are cautioned that the
foregoing list is not exhaustive of all factors and assumptions
which have been used. As a consequence, actual results may differ
materially from those anticipated in the forward-looking
statements. Additional information on these and other factors that
could affect Bellatrix's operations and financial results are
included in reports, including under the heading "Risk Factors" in
the Company's annual information form for the year ended December
31, 2017, on file with Canadian and United States securities
regulatory authorities and may be accessed through the SEDAR
website (www.sedar.com), through the SEC website (www.sec.gov), and
at Bellatrix's website (www.bxe.com). Furthermore, the forward
looking statements contained herein are made as at the date hereof
and Bellatrix does not undertake any obligation to update publicly
or to revise any of the included forward looking statements,
whether as a result of new information, future events or otherwise,
except as may be required by applicable securities laws.