Bonterra Energy Corp. Provides an Operations Update and Releases
Its Corporate Reserves Information
CALGARY, ALBERTA--(Marketwired - Feb 11, 2014) - Bonterra Energy
Corp. (Bonterra or the Company) (www.bonterraenergy.com) (TSX:BNE)
is pleased to provide an operational update including 2013
highlights and its ongoing Cardium development program as well as
the results of its independent reserve report prepared by Sproule
Associates Limited with an effective date of December 31, 2013.
Operational
Highlights
- Record average daily production for the full year of 12,190
barrels of oil equivalent (BOE) per day (70.0 percent oil and
liquids), an increase of 81.9 percent over the same period in
2012.
- Record average daily production of 12,456 BOE per day in the
fourth quarter, an increase of 62.5 percent when compared to the
fourth quarter of 2012.
- Production per fully diluted share increased 18.5 percent to
0.147 BOE per share from 0.124 BOE per share from the prior
year.
- The Board of Directors has approved a 2014 capital development
program of $120.0 million which mainly targets light oil prospects
In the Pembina Cardium Field, most notably focused on development
in its Carnwood area holdings.
- Currently 56 gross (41.05 net) wells are planned for 2014.
Bonterra intends to spend approximately $72 million of its capital
budget in the Carnwood area, drilling 26 gross (25.5 net) wells and
completing 30 wells (includes four wells which were drilled in
2013). In addition, Bonterra has allocated approximately $13.4
million for infrastructure optimizations and secondary recovery
pilot projects.
- The first Carnwood unit four well pad's (16-12-48-6) first full
month of production averaged 191 BOE per day per well. The second
four well pad (14-12-48-6) has just been placed on production, with
the third four well pad (09-02-48-6) to be placed on production by
the end of February 2014.
- Bonterra's full year production levels in 2014 are expected to
average between 12,400 and 12,700 BOE per day (72 percent oil and
liquids).
- Bonterra continues to pursue technological enhancements
(including longer horizontal lengths, increased frac densities,
limited entry frac design and a potential transition to cemented
completions) in order to reduce average well costs and improve
recoveries.
The Company has not released its audited 2013 financial results
therefore the numbers provided are currently estimates and
unaudited.
Corporate Reserves
Information
Bonterra engaged the services of Sproule Associates Limited to
prepare a reserve evaluation with an effective date of December 31,
2013. The gross reserve figures from the following tables represent
Bonterra's ownership interest before royalties and before
consideration of the Company's royalty interests. Tables may not
add due to rounding.
Reserve Report
Highlights
- Increased proved plus probable reserves by 66.5 percent to 75.0
mmboe (74 percent oil and liquids) and proved reserves by 63.3
percent to 54.1 mmboe (74 percent oil and liquids).
- Total proved reserves represent 72.1 percent of total proved
plus probable reserves.
- Reserves per fully diluted share (P+P) increased 8.3 percent to
2.47 BOE per share compared to 2.28 BOE per share from the prior
year.
- Reserve life index of 16.9 years on P+P basis, 11.8 years on a
proved basis, and 6.9 years on a PDP basis (based on 2013 average
production rate of 12,190 BOE per day) continues to remain above
industry average.
- Booked reserves represent approximately 30 percent of
Bonterra's current potential inventory of undrilled locations.
Summary of Gross Oil and Gas Reserves as of December 31,
2013
Reserve Category: |
Light and Medium Oil (Mbbl) |
Natural Gas (MMcf) |
Natural Gas Liquids (Mbbl) |
BOE(1) (MBOE) |
PROVED |
|
|
|
|
|
Developed Producing |
20,015 |
51,518 |
1,905 |
30,506 |
|
Developed Non-Producing |
457 |
1,180 |
39 |
692 |
|
Undeveloped |
16,655 |
30,372 |
1,180 |
22,897 |
TOTAL PROVED |
37,127 |
83,070 |
3,124 |
54,096 |
PROBABLE |
14,174 |
33,120 |
1,191 |
20,885 |
TOTAL PROVED PLUS PROBABLE |
51,301 |
116,190 |
4,315 |
74,981 |
Reconciliation of Company Gross Reserves by Principal
Product
Type as of December 31, 2013
|
Light and Medium Oil and Natural Gas Liquids |
|
Natural Gas |
|
BOE(1) |
|
|
Proved (Mbbl) |
|
Proved plus Probable (Mbbl) |
|
Proved (MMcf) |
|
Proved plus Probable (MMcf) |
|
Proved (MBOE) |
|
Proved Plus Probable (MBOE) |
|
December 31, 2012 |
24,925 |
|
33,662 |
|
49,258 |
|
68,221 |
|
33,134 |
|
45,032 |
|
|
Extension |
826 |
|
1,207 |
|
1,839 |
|
2,727 |
|
1,133 |
|
1,662 |
|
|
Infills |
3,155 |
|
4,115 |
|
5,140 |
|
6,658 |
|
4,012 |
|
5,225 |
|
|
Improved Recovery |
0 |
|
0 |
|
0 |
|
0 |
|
0 |
|
0 |
|
|
Technical Revisions |
(423 |
) |
(1,482 |
) |
12,832 |
|
15,563 |
|
1,716 |
|
1,112 |
|
|
Discoveries |
0 |
|
0 |
|
0 |
|
0 |
|
0 |
|
0 |
|
|
Acquisitions |
14,751 |
|
21,077 |
|
22,116 |
|
31,115 |
|
18,437 |
|
26,263 |
|
|
Dispositions |
0 |
|
0 |
|
0 |
|
0 |
|
0 |
|
0 |
|
|
Economic factors |
131 |
|
150 |
|
(102 |
) |
(82 |
) |
114 |
|
136 |
|
|
Production |
(3,114 |
) |
(3,114 |
) |
(8,013 |
) |
(8,013 |
) |
(4,449 |
) |
(4,449 |
) |
December 31, 2013 |
40,251 |
|
55,616 |
|
83,070 |
|
116,190 |
|
54,096 |
|
74,981 |
|
Summary of Net Present Values of Future Net Revenue as of
December 31, 2013
|
Net Present Value Before Income Taxes Discounted at (%
per Year) |
($ Millions) |
0% |
5% |
10% |
Reserve Category: |
|
|
|
PROVED |
|
|
|
|
Developed Producing |
1,390,356 |
931,047 |
711,393 |
|
Developed Non-Producing |
32,856 |
25,609 |
21,496 |
|
Undeveloped |
897,711 |
487,517 |
288,092 |
TOTAL PROVED |
2,320,923 |
1,444,173 |
1,020,981 |
PROBABLE |
1,203,225 |
485,064 |
249,468 |
TOTAL PROVED PLUS PROBABLE |
3,524,148 |
1,929,237 |
1,270,449 |
Finding, Development and Acquisition (FD&A) Costs
The Company has historically been active in its capital
development program. Over three years, Bonterra has incurred the
following FD&A(3) costs excluding Future Development Costs:
|
2013 FD&A Costs per BOE(1)(2)(3) |
2012 FD&A Costs per BOE(1)(2)(3) |
2011 FD&A Costs per BOE(1)(2)(3) |
Three Year Average(4) |
Proved Reserve Net Additions |
$ |
23.63 |
$ |
13.64 |
$ |
33.22 |
$ |
22.01 |
Proved plus Probable Reserve Net Additions |
$ |
20.12 |
$ |
16.05 |
$ |
15.38 |
$ |
19.11 |
Over three years, Bonterra has incurred the following
FD&A(3) costs including Future Development Costs:
|
2013 FD&A Costs per BOE(1)(2)(3) |
2012 FD&A Costs per BOE(1)(2)(3) |
2011 FD&A Costs per BOE(1)(2)(3) |
Three Year Average(5) |
Proved Reserve Net Additions |
$ |
24.80 |
$ |
20.91 |
$ |
57.53 |
$ |
23.26 |
Proved plus Probable Reserve Net Additions |
$ |
21.06 |
$ |
21.62 |
$ |
35.40 |
$ |
20.22 |
Finding and Development (F&D) Costs
Over three years, Bonterra has incurred the following F&D(3)
costs excluding Future Development Costs:
|
2013 F&D Costs per BOE(1)(2)(3) |
2012 F&D Costs per BOE(1)(2)(3) |
2011 F&D Costs per BOE(1)(2)(3) |
Three Year Average(4) |
Proved Reserve Net Additions |
$ |
17.10 |
$ |
13.56 |
$ |
33.06 |
$ |
17.64 |
Proved plus Probable Reserve Net Additions |
$ |
13.41 |
$ |
18.79 |
$ |
15.31 |
$ |
15.24 |
Over three years, Bonterra has incurred the following F&D
(3) costs including Future Development Costs:
|
2013 F&D Costs per BOE(1)(2)(3) |
2012 F&D Costs per BOE(1)(2)(3) |
2011 F&D Costs per BOE(1)(2)(3) |
Three Year Average(5) |
Proved Reserve Net Additions |
$ |
21.38 |
$ |
22.26 |
$ |
57.37 |
$ |
20.51 |
Proved plus Probable Reserve Net Additions |
$ |
17.04 |
$ |
26.61 |
$ |
35.33 |
$ |
18.09 |
(1) |
Barrels of Oil Equivalent may be misleading, particularly if used
in isolation. A BOE conversion ratio of 6 MCF: 1 bbl is based on an
energy equivalency conversion method primarily applicable at the
burner tip and does not represent a value equivalency at the
wellhead. |
(2) |
The
aggregate of the exploration and development costs incurred in the
most recent financial year and the change during that year in
estimated future development costs generally will not reflect total
finding and development costs related to reserve additions for that
year. |
(3) |
FD&A and F&D costs are net of proceeds of disposal and the
FD&A costs per BOE are based on reserves acquired net of
reserves disposed of. |
(4) |
Three
year average is calculated using three year total capital costs and
reserve additions on both a Proved and Proved plus Probable
basis. |
(5) |
Three
year average is calculated using three year total capital costs and
reserves additions on both a Proved and Proved plus Probable basis
plus the average change in future capital costs over the three year
period. |
Certain financial and operating information, such as production
information, finding and development costs and net asset values,
included in this press release for the quarter and year ended
December 31, 2013 are based on estimated unaudited financial
results for the year and are subject to the same limitations as
discussed under Forward Looking Statements set out below. These
estimated amounts may change upon the completion of audited
financial statements for the year ended December 31, 2013 and
changes could be material. All reserve numbers provided above are
Bonterra's interest before royalties.
It should not be assumed that the estimates of future net
revenue presented in the above tables represent the fair market
value of the reserves. There is no assurance that the forecast
prices and costs assumptions will be attained and variances could
be material. Estimates of reserves and future net revenues for
individual properties may not reflect the same confidence level as
estimates of reserves and future net revenues for all properties
due to the effects of aggregation.
Caution Regarding Engineering Terms:
Disclosure provided herein in respect of barrels of oil
equivalent (BOE) may be misleading, particularly if used in
isolation. In accordance with NI 51-101, a BOE conversion ratio of
6 MCF to 1 barrel has been used in all cases in this disclosure.
This BOE conversion ratio is based on an energy equivalency
conversion method primarily available at the burner tip and does
not represent a value equivalency at the wellhead.
Forward-looking Information
Certain statements contained in this release include statements
which contain words such as "anticipate", "could", "should",
"expect", "seek", "may", "intend", "likely", "will", "believe" and
similar expressions, relating to matters that are not historical
facts, and such statements of our beliefs, intentions and
expectations about development, results and events which will or
may occur in the future, constitute "forward-looking information"
within the meaning of applicable Canadian securities legislation
and are based on certain assumptions and analysis made by us
derived from our experience and perceptions. Forward-looking
information in this release includes, but is not limited to:
expected cash provided by continuing operations; cash dividends;
future capital expenditures, including the amount and nature
thereof; oil and natural gas prices and demand; expansion and other
development trends of the oil and gas industry; business strategy
and outlook; expansion and growth of our business and operations;
and maintenance of existing customer, supplier and partner
relationships; supply channels; accounting policies; credit risks;
and other such matters.
All such forward-looking information is based on certain
assumptions and analyses made by us in light of our experience and
perception of historical trends, current conditions and expected
future developments, as well as other factors we believe are
appropriate in the circumstances. The risks, uncertainties, and
assumptions are difficult to predict and may affect operations, and
may include, without limitation: foreign exchange fluctuations;
equipment and labour shortages and inflationary costs; general
economic conditions; industry conditions; changes in applicable
environmental, taxation and other laws and regulations as well as
how such laws and regulations are interpreted and enforced; the
ability of oil and natural gas companies to raise capital; the
effect of weather conditions on operations and facilities; the
existence of operating risks; volatility of oil and natural gas
prices; oil and gas product supply and demand; risks inherent in
the ability to generate sufficient cash flow from operations to
meet current and future obligations; increased competition; stock
market volatility; opportunities available to or pursued by us; and
other factors, many of which are beyond our control.
Actual results, performance or achievements could differ
materially from those expressed in, or implied by, this
forward-looking information and, accordingly, no assurance can be
given that any of the events anticipated by the forward-looking
information will transpire or occur, or if any of them do, what
benefits will be derived there from. Except as required by law,
Bonterra disclaims any intention or obligation to update or revise
any forward-looking information, whether as a result of new
information, future events or otherwise.
The forward-looking information contained herein is expressly
qualified by this cautionary statement.
The TSX does
not accept responsibility for the accuracy of this
release.
Bonterra Energy Corp.George F. FinkChairman and CEO(403)
262-5307(403) 265-7488Bonterra Energy Corp.Robb D. ThompsonCFO and
Secretary(403) 262-5307(403) 265-7488Bonterra Energy Corp.Kirsten
LankesterManager, Investor Relations(403) 262-5307(403)
265-7488info@bonterraenergy.comwww.bonterraenergy.com
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