Nexen Announces Achievement of Two Important Milestones at Long Lake
26 June 2012 - 8:00PM
PR Newswire (Canada)
Pad 12 Producing and Pad 13 Steaming Ahead of Schedule CALGARY,
June 26, 2012 /CNW/ - Nexen Inc. today announced that we have
reached two major milestones in our plan to fill the Long Lake
upgrader: first oil production from pad 12 and first steam into pad
13. We exceeded our expectations for first production from pad 12
with conversion of wells to SAGD after approximately 70 days of
steam circulation versus our previous experience of approximately
90 to 120 days. The acceleration was due to new completion
technologies and processes that will now be the standard for future
wells. Currently three of the nine wells are in production with the
remainder expected to be converted over the next few weeks as we
install the electronic submersible pumps. Steam injection on pad 13
is also ahead of schedule primarily as a result of the efficiency
of steam utilization on the pad 12 start-up. We are now steaming
all nine wells on the pad. First bitumen production is expected
later this year. Production from pads 12 and 13 is expected
to ramp-up to full rates over an 18 to 24 month period. "Exceeding
expectations on these two milestones is a significant
accomplishment. We continue to see real progress at Long Lake,"
said Kevin Reinhart, Nexen's interim President & CEO. The Long
Lake project is also progressing in other areas. Pad 11
continues to ramp-up and is trending towards the upper end of our
expected range of 4,000 to 8,000 bbls/d. On pads 14, 15 and Kinosis
1A, we are progressing site civil work and engineering, and expect
to start drilling mid-summer. Steam injection is expected on pads
14 and 15 in the second half of 2013, with Kinosis 1A following by
mid-year 2014. Nexen has a 65% working interest in both Long Lake
and Kinosis and is the operator. The remaining 35% interest is held
by CNOOC Canada Inc. About Nexen Nexen Inc. is an independent,
Canadian-based global energy company, listed on the Toronto and New
York stock exchanges under the symbol NXY. Nexen is focused on
three growth strategies: oil sands and shale gas in Western Canada
and conventional exploration and development primarily in the North
Sea, offshore West Africa and deepwater Gulf of Mexico. Nexen adds
value for shareholders through successful full-cycle oil and gas
exploration and development, and leadership in ethics, integrity,
governance and environmental stewardship. Forward-Looking
Statements Certain statements in this Release constitute
"forward-looking statements" (within the meaning of the United
States Private Securities Litigation Reform Act of 1995, as
amended) or "forward-looking information" (within the meaning of
applicable Canadian securities legislation). Such statements or
information (together "forward-looking statements") are generally
identifiable by the forward-looking terminology used such as
"anticipate", "believe", "intend", "plan", "expect", "estimate",
"budget", "outlook", "forecast" or other similar words and include
statements relating to or associated with individual wells, regions
or projects. Any statements as to possible future crude oil or
natural gas prices; future production levels; future royalties and
tax levels; future capital expenditures, their timing and their
allocation to exploration and development activities; future
earnings; future asset acquisitions or dispositions; future sources
of funding for our capital program; future debt levels;
availability of committed credit facilities; possible commerciality
of our projects; development plans or capacity expansions; the
expectation that we have the ability to substantially grow
production at our oil sands facilities through controlled
expansions; the expectation of achieving the production design
rates from our oil sands facilities; the expectation that our oil
sands production facilities continue to develop better and more
sustainable practices; the expectation of cheaper and more
technologically advanced operations; the expected design size of
our facilities; the expected timing and associated production
impact of facility turnarounds and maintenance; the expectation
that we can continue to operate our offshore exploration,
development and production facilities safely and profitably; future
ability to execute dispositions of assets or businesses; future
sources of liquidity, cash flows and their uses; future drilling of
new wells; ultimate recoverability of current and long-term assets;
ultimate recoverability of reserves or resources; expected finding
and development costs; expected operating costs; future cost
recovery oil revenues from our Yemen operations; the expectation of
our ability to comply with the new safety and environmental rules
enacted in the US at a minimal incremental cost, and of receiving
necessary drilling permits for our US offshore operations;
estimates on a per share basis; future foreign currency exchange
rates; future expenditures and future allowances relating to
environmental matters and our ability to comply with them; dates by
which certain areas will be developed, come on stream or reach
expected operating capacity; and changes in any of the foregoing
are forward-looking statements. Statements relating to "reserves"
or "resources" are forward-looking statements, as they involve the
implied assessment, based on estimates and assumptions that the
reserves and resources described exist in the quantities predicted
or estimated and can be profitably produced in the future. All of
the forward-looking statements in this Release are qualified by the
assumptions that are stated or inherent in such forward-looking
statements. Although we believe that these assumptions are
reasonable based on the information available to us on the date
such assumptions were made, this list is not exhaustive of the
factors that may affect any of the forward-looking statements and
the reader should not place an undue reliance on these assumptions
and such forward-looking statements. The key assumptions that have
been made in connection with the forward-looking statements include
the following: that we will conduct our operations and achieve
results of operations as anticipated; that our development plans
will achieve the expected results; the general continuance of
current or, where applicable, assumed industry conditions; the
continuation of assumed tax, royalty and regulatory regimes; the
accuracy of the estimates of our reserve volumes; commodity price
and cost assumptions; the continued availability of adequate cash
flow and debt and/or equity financing to fund our capital and
operating requirements as needed; and the extent of our
liabilities. We believe the material factors, expectations and
assumptions reflected in the forward-looking statements are
reasonable, but no assurance can be given that these factors,
expectations and assumptions will prove to be correct.
Forward-looking statements are subject to known and unknown risks
and uncertainties and other factors, many of which are beyond our
control and each of which contributes to the possibility that our
forward-looking statements will not occur or that actual results,
levels of activity and achievements may differ materially from
those expressed or implied by such statements. Such factors
include, among others: market prices for oil and gas; our ability
to explore, develop, produce, upgrade and transport crude oil and
natural gas to markets; ultimate effectiveness of design or design
modifications to facilities; the results of exploration and
development drilling and related activities; the cumulative impact
of oil sands development on the environment; the impact of
technology on operations and processes and how new complex
technology may not perform as expected; the availability of
pipeline and global refining capacity; risks inherent to the
operations of any large, complex refinery units, especially the
integration between production operations and an upgrader facility;
availability of third-party bitumen for use in our oil sands
production facilities; labour and material shortages; risks related
to accidents, blowouts and spills in connection with our offshore
exploration, development and production activities, particularly
our deep-water activities; direct and indirect risks related to the
imposition of moratoriums, suspensions or cancellations of our
offshore exploration, development and production operations,
particularly our deep-water activities; the impact of severe
weather on our offshore exploration, development and production
activities, particularly our deep-water activities; the
effectiveness and reliability of our technology in harsh and
unpredictable environments; risks related to the actions and
financial circumstances of our agents and contractors,
counterparties and joint venture partners; volatility in energy
trading markets; foreign currency exchange rates; economic
conditions in the countries and regions in which we carry on
business; governmental actions including changes to taxes or
royalties, changes in environmental and other laws and regulations
including without limitation, those related to our offshore
exploration, development and production activities; renegotiations
of contracts; results of litigation, arbitration or regulatory
proceedings; political uncertainty, including actions by
terrorists, insurgent or other groups, or other armed conflict,
including conflict between states; and other factors, many of which
are beyond our control. These risks, uncertainties and other
factors and their possible impact are discussed more fully in the
sections titled "Risk Factors" in our 2011 Annual Information Form
and "Quantitative and Qualitative Disclosures About Market Risk" in
our 2011 annual MD&A. The impact of any one risk, uncertainty
or factor on a particular forward-looking statement is not
determinable with certainty as these factors are interdependent,
and management's future course of action would depend on our
assessment of all information at that time. Although we believe
that the expectations conveyed by the forward-looking statements
are reasonable based on information available to us on the date
such forward-looking statements were made, no assurances can be
given as to future results, levels of activity and achievements.
Undue reliance should not be placed on the forward-looking
statements contained herein, which are made as of the date hereof
as the plans, intentions, assumptions or expectations upon which
they are based might not occur or come to fruition. Except as
required by applicable securities laws, Nexen undertakes no
obligation to update publicly or revise any forward-looking
statements, whether as a result of new information, future events
or otherwise. Included herein is information that may be considered
financial outlook and/or future-oriented financial information
(FOFI). Its purpose is to indicate the potential results of our
intentions and may not be appropriate for other purposes. The
forward-looking statements contained herein are expressly qualified
by this cautionary statement. Nexen Inc. CONTACT: For investor
relations inquiries, please contact:Janet CraigVice President,
Investor Relations(403) 699-4230For media and general inquiries,
please contact:Pierre Alvarez Vice President, Corporate
Relations(403) 699-5202801 - 7th Ave SWCalgary, Alberta, Canada T2P
3P7www.nexeninc.com
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