TSX, NYSE: BXE
CALGARY, Dec. 22, 2014 /PRNewswire/ - Bellatrix
Exploration Ltd. ("Bellatrix" or the "Company") (TSX, NYSE: BXE)
announces a revised 2015 capital budget focused on completing its
strategic infrastructure initiatives and drilling high rate of
return liquids-rich natural gas development opportunities, while
maintaining a strong balance sheet. Bellatrix is also pleased to
announce it has achieved its 2014 exit rate production
guidance.
In light of the recent rapid declines in crude oil prices,
Bellatrix has decided it is prudent to revise its 2015 capital
budget to $300 million (from
$400 million) to maintain balance
between delivering organic growth and preserving its strong
financial position in a lower commodity price environment. The
focus of the 2015 budget is twofold: to complete construction of
Phase 1 of the Bellatrix O'Chiese Nees-Ohpawganu'ck deep-cut gas
plant at Alder Flats, and to drill
high rate of return Spirit River
(Notikewin / Falher) liquids-rich
natural gas wells where production can be processed through the new
plant. The Company's Cardium drilling program will be tempered to
focus on expiring leases and commitment wells until oil prices
recover.
Approximately 35% of the 2015 capital budget is allocated to
facilities which includes completing construction of Phase 1 of
Bellatrix's new deep-cut gas plant, which remains on schedule and
on budget for a July 2015 start-up,
and which is designed to process up to 110 mmcf/d, thereby giving
Bellatrix the ability to grow its net production to approximately
65,000 boe/d utilizing existing strategic and third party
infrastructure. A total of 4% of the 2015 capital budget is
allocated to land and seismic with the remaining 61% focused on
drilling.
The $100 million or 25% reduction
in the 2015 capital budget from our previously announced
expectation reflects a reduced drilling budget and a deferral of
the timing of construction of Phase 2 of the deep-cut gas plant.
Based on Bellatrix's forecast capacity requirements, the on-stream
date of Phase 2 of the new deep-cut gas plant can be deferred until
Q4 2016 from the original on stream date of Q2 2016 with no change
in capital cost, which will then allow the Company access to
approximately 80,000 boe/d of processing capacity.
As a corollary of the reduced capital budget, Bellatrix is
reducing its previously announced 2015 average production guidance
range to approximately 47,000 to 48,000 boe/d (70% natural gas, 30%
liquids). The midpoint of this 2015 average production guidance
range reflects an organic growth rate of approximately 23% over the
expected 2014 average daily production guidance of approximately
38,500 boe/d.
Bellatrix has recently completed and placed on stream the first
segment of the Twin Rivers pipeline, thereby accessing additional
capacity. In addition, the 'booster compressor' required to
flow more gas at a higher pressure into our north lateral is on
schedule for start-up on December 22,
2014. These initiatives, combined with our Q4 drilling
program, have enabled us to achieve our 2014 exit rate production
guidance of 47,000 to 49,000 boe/d.
Bellatrix Exploration Ltd. is a 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 in the provinces of Alberta, British
Columbia and Saskatchewan. Common shares of Bellatrix
trade on the Toronto Stock Exchange and on the New York Stock
Exchange under the symbol BXE.
Forward looking statements: Certain information set forth in
this news release, including management's assessment of future
plans and operations, management's expectations regarding the
timing and cost of construction of the Company's new deep-cut gas
plant, management's assessment of future processing capacity
requirements, and the future processing capacity of the new
deep-cut gas plant, management's assessment of the impact of
deferral of construction of Phase 2 of the new deep-cut gas plant,
estimates of current and future production rates, expectations
regarding wells the Company intends to drill and the rates of
return associated with such wells, and expectations regarding the
Company's 2015 average production volumes and associated commodity
mix, may contain forward-looking statements, and necessarily
involve risks and uncertainties, certain of which are beyond
Bellatrix's control, including risks associated with oil and gas
exploration, development, exploitation, production, marketing and
transportation, loss of markets and other economic and industry
conditions, volatility of commodity prices, currency fluctuations,
imprecision of reserve estimates, environmental risks, competition
from other producers, inability to retain drilling services,
incorrect assessment of value of acquisitions and failure to
realize the benefits therefrom, delays resulting from or inability
to obtain required regulatory approvals, the lack of availability
of qualified personnel or management, stock market volatility,
ability to access sufficient capital from internal and external
sources, and economic or industry condition changes. Actual
results, performance or achievements could differ materially from
those expressed in, or implied by, these forward-looking statements
and, accordingly, no assurance can be given that any events
anticipated by the forward-looking statements will transpire or
occur, or if any of them do so, what benefits that Bellatrix will
derive therefrom. To the extent such estimates constitute a
financial outlook, they were approved by management on the date
hereof and are included herein to provide readers with an
understanding of management's expectations and assumptions about
future activities and results and readers are cautioned that the
information may not be appropriate for other purposes. Additional
information on these and other factors that could affect Bellatrix
are included in reports on file with Canadian securities regulatory
authorities and the United States Securities and Exchange
Commission and may be accessed through the SEDAR website
(www.sedar.com), the SEC's website (www.sec.gov) or at Bellatrix's
website www.bellatrixexploration.com. The forward looking
statements contained in this press release are made as of the date
hereof and Bellatrix undertakes no obligations to update publicly
or revise any forward looking statements or information, whether as
a result of new information, future events or otherwise, unless so
required by applicable securities laws.
Conversion: The term barrels of oil equivalent ("boe") may be
misleading, particularly if used in isolation. A boe conversion
ratio of six thousand cubic feet of natural gas to one barrel of
oil equivalent (6 mcf/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. Given that the
value ratio based on the current price of crude oil as compared to
natural gas is significantly different from the energy equivalency
of six to one, utilizing a conversion on a six to one basis may be
misleading as an indication of value. All boe conversions herein
are derived from converting gas to oil in the ratio of six thousand
cubic feet of gas to one barrel of oil.
SOURCE Bellatrix Exploration Ltd.