Equal Energy Provides Operations Update To Coincide with Investor Field Trip
--Public Is Invited To Attend Webcast Investor Presentation--
OKLAHOMA CITY, OK, June 24, 2013 /PRNewswire/ - Equal Energy Ltd. (NYSE: EQU) (TSX:EQU.TO) is pleased to provide an operations update to coincide with its investor field trip scheduled for tomorrow. Equal also invites the public to attend a webcast of its field trip investor presentation from 8:00 am to 9:30 am Central Time tomorrow.
Key information to be discussed includes:
- Results from Equal's two wells completed last week that are currently on production. These wells are the fourth and fifth wells of the ten well program planned for this year.
- Average production rates of the wells completed in 2013 are above the type curve model, while well costs are in line with budget.
- Drilling operations on the sixth well are wrapping up. Six wells drilled before the end of June provides validation of operational improvement including less than 30 days of drilling time per well.
- Production is on track to meet or exceed full year budget rate of 6,400 boe/d
"During our investor field trip we will be explaining the benefit of our strategy, which is to focus on the Hunton play in central Oklahoma," said Don Klapko, President and Chief Executive Officer. "Our drilling so far in the second quarter, as in the first quarter, has a perfect record for successful Hunton wells and as a result we remain on track to meet the previously disclosed full-year production target of 6,400 barrels of oil equivalent per day, based on a 10 well drilling program."
As part of Equal's second quarter 2013 financial disclosure on August 8, 2013, the company expects to announce the results of the Board's mid-year capital efficiency review and Equal's associated go forward plan.
Based on actual production for April and May and anticipated production for June, Equal expects it will achieve second quarter 2013 production of approximately 6,300 boe/d. This compares to 6,280 boe/d in the first quarter of 2013. The quarterly growth in production was achieved in spite of three unusual events that impacted field operations and caused an approximate 170 boe/d to be shut in during the quarter. The first of these events was caused by a third party product purchaser's infrastructure failure, causing our Goodnight field to be shut in for 17 days in April. The second was due to a lightning strike at a disposal well and the last was the previously reported tornado in May. Operations have since returned to normal.
The fourth and fifth wells were completed last week and are currently producing at a combined rate of approximately 170 boe/d, net to Equal, and are continuing to increase. Hunton wells typically take an average of 90 days to reach peak production and then usually maintain that peak rate for 18 months. Average capital expenditures for the two latest wells, including infrastructure costs, were $2.6 million. This compares favorably with an average of $2.7 million per well for the first three wells of 2013.
Drilling operations on Equal's sixth well for 2013 are currently wrapping up. We anticipate this well to be completed and online in July.
Internal Capital Efficiency Review
After the sixth well is brought on line, Equal will perform a look-back analysis to evaluate the capital efficiency of Equal's 2013 drilling program. However, based on the faster than expected drilling operations and production success experienced so far this year, Equal is currently committing to drill the seventh well of its planned 10 well program.
Looking ahead to the second half of the year and taking into consideration factors such as commodity prices and Equal's share price, the Board of Directors will consider various operational options for the remainder of 2013.
Depending on the outcome of this review, Equal plans to update 2013 guidance as part of its second quarter results news release on August 8, 2013. For reference, based on typical Hunton production profile, one additional successful well is projected to increase next year's production by approximately 2% at a total expected cost of $2.7 million for drilling, completion and infrastructure.
Investor Field Trip Presentation Webcast
Equal's webcast of its Investor Field Trip on Tuesday, June 25 will provide the public with real-time access to the operational presentation and discussion.
Equal will then conduct a field tour of its operations for investors who are present to participate. The presentation and webcast will be posted to Equal's website at www.equalenergy.ca and will be available via replay.
About Equal Energy:
Equal Energy is an oil and gas exploration and production company based in Oklahoma City, Oklahoma. Our oil and gas assets are centered on the Hunton liquids-rich natural gas property in Oklahoma. Our shares are listed on the New York Stock Exchange and the Toronto Stock Exchange under the symbol (EQU). Our convertible debentures are listed on the Toronto Stock Exchange under the symbols EQU.DB.B.
Certain information in this press release constitutes forward-looking statements under applicable securities law including full year 2013 and second quarter 2013 production, announcements regarding the planned capital efficiency and strategic alternatives reviews, the typical Hunton production profile, the planned drilling and completion of wells, the planned investor day presentation and other matters. Any statements that are contained in this press release that are not statements of historical fact may be deemed to be forward-looking statements. Forward-looking statements are often identified by terms such as "may," "should," "anticipate," "expects," "seeks" and similar expressions.
Forward-looking statements necessarily involve known and unknown risks, such as risks associated with oil and gas production; marketing and transportation; loss of markets; volatility of commodity prices; currency and interest rate fluctuations; imprecision of reserve and future production estimates; environmental risks; competition; incorrect assessment of the value of acquisitions; failure to realize the anticipated benefits of dispositions; inability to access sufficient capital from internal and external sources; changes in legislation, including but not limited to income tax, environmental laws and regulatory matters. Readers are cautioned that the foregoing list of factors is not exhaustive.
Readers are cautioned not to place undue reliance on forward-looking statements as there can be no assurance that the plans, intentions or expectations upon which they are placed will occur. Such information, although considered reasonable by management at the time of preparation, may prove to be incorrect and actual results may differ materially from those anticipated forward looking statements contained in this press release are expressly qualified by this cautionary statement.
Additional information on these and other factors that could affect Equal's operations or financial results are included in Equal's reports on file with Canadian and U.S. securities regulatory authorities and may be accessed through the SEDAR website (www.sedar.com), the SEC's website (www.sec.gov), Equal's website (www.equalenergy.ca) or by contacting Equal. Furthermore, the forward looking statements contained in this press release are made as of the date of this press release, and Equal 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 expressly required by securities law.
SOURCE Equal Energy Ltd.