CALGARY, Jan. 20, 2015 /CNW/ - Marquee Energy Ltd.
("Marquee" or the "Company") (TSXV: "MQL") is pleased to announce
record production which currently exceeds 5,600 boe/d. The company
expects an additional 250 boe/d to come on after completing a pump
re-configuration on two of its recently drilled wells at Michichi.
Given Marquee's continued drilling success, the Company estimates
fourth quarter production of approximately 5,250 boe/d and 2014
average production of 4,860 boe/d based on field estimates, which
is a 120% increase over 2013 production of 2,196 boe/d.
With world crude prices down by 50%, Marquee is entering 2015
with a cautious outlook and at the present time, is only providing
guidance for the first half of the year. The Company is basing its
budget on WTI US$50/bbl and AECO
CAD$2.65/gj with an exchange rate of
US$1.00/C$0.86. Cashflow for the first half of 2015 is
estimated at $13.1 million with
capital spending limited to $5.6
million, with a view to use excess cashflow to organically
reduce debt. The capital program includes the drilling of two
strategic wells, one at Michichi and one at Lloydminster, as well as some necessary
facility infrastructure expenses. Debt at the end of the first half
is projected to be approximately $53.6
million (2.0x 1H15 annualized D/CF ratio). First half
production is expected to average 5,300 boe/d, in line with fourth
quarter 2014 production.
"Our management team and Board of Directors have successfully
grown a number of junior oil and gas companies through volatile
phases of the commodity cycle. During the current downturn, we will
be prudent and conservative in maintaining a strong balance sheet
while reducing our capital spending to less than estimated cash
flow," said Richard Thompson,
President & CEO of Marquee. "The Board intends to revisit the
capital budget for the second half of 2015 during the second
quarter and determine appropriate expenditure levels consistent
with prevailing commodity prices."
The Company continues to actively pursue various initiatives to
improve operating, capital, and overhead efficiencies. Marquee will
also continue to work with its service providers to ensure further
cost reductions. The Company has already experienced reductions in
drilling and related costs approaching 10% on a per well basis and
expects further decreases to occur in the event there is no
near-term recovery in oil prices. During 2014, the Company invested
capital in acquiring and expanding facilities and pipeline
infrastructure which will continue to aid in the reduction of field
operating expenses and accommodate future growth.
Marquee has assembled more than 300 square miles of land at
Michichi and Lloydminster and has
built a drilling inventory comprised of over 225 locations. During
2014, the Company acquired the remaining 3D seismic needed to
complete the evaluation of its focus area at Michichi. Marquee
continues to adjust its drilling and completions program at
Michichi leading to lower costs, higher productivity wells and
consistency in results.
The Company has a strong balance sheet and the operational
flexibility to adjust activity levels with a change in commodity
prices. Marquee remains committed to its long term business plan of
providing meaningful per share growth in value. During 2014, the
Company achieved over 70% growth in per share debt adjusted cash
flow, compared to 2013. Marquee will continue to pursue accretive
property, land, and corporate acquisitions, in addition to
expanding its growing inventory of drill ready prospects at both
Michichi and Lloydminster.
ABOUT MARQUEE
Marquee Energy Ltd. is a Calgary based, junior oil and gas company
focused on high rate of return oil development and production.
Marquee is committed to growing the company through exploitation of
existing opportunities and continued consolidation within its core
area at Michichi. The Company's shares are traded on the Toronto
Stock Exchange under the trading symbol "MQL.V" and on the OTCQX
marketplace under the symbol "MQLXF". An updated presentation and
additional information about Marquee may be found on its website
www.marquee-energy.com and in its continuous disclosure documents
filed with Canadian securities regulators on the System for
Electronic Document Analysis and Retrieval (SEDAR) at
www.sedar.com.
FORWARD LOOKING STATEMENTS OR INFORMATION
Certain statements included or incorporated by reference in this
news release may constitute forward looking statements under
applicable securities legislation. Such forward looking
statements or information typically contain statements with words
such as "anticipate", "believe", "expect", "plan", "intend",
"estimate", "propose", or similar words suggesting future outcomes
or statements regarding an outlook. Forward looking
statements or information in this news release may include, but are
not limited to: the number and quality of future potential drilling
opportunities; anticipated capital budgets and expenditures;
petroleum and natural gas sales; anticipated 2014 exit production,
cashflow and debt; anticipated 2014 exit debt to 2014 annualized
cashflow; the timing of facility improvements; and business
strategies, objectives and outlook.
Such forward-looking statements or information are based on a
number of assumptions all or any of which may prove to be
incorrect. In addition to any other assumptions identified in
this document, assumptions have been made regarding, among other
things: the ability of the Company to obtain equipment, services
and supplies in a timely manner to carry out its activities; the
ability of the Company to market crude oil, natural gas liquids and
natural gas successfully to current and new customers; the ability
to secure adequate product transportation; the timely receipt of
required regulatory approvals; the ability of the Company to obtain
financing on acceptable terms; interest rates; regulatory framework
regarding taxes, royalties and environmental matters; future crude
oil, natural gas liquids and natural gas prices; and management's
expectations relating to the timing and results of development
activities.
Forward-looking information is based on current expectations,
estimates and projections that involve a number of risks and
uncertainties which could cause actual results to differ materially
from those anticipated by the Company and described in the
forward-looking information. The material risk factors affecting
the Company and its business are contained in Marquee's Annual
Information Form which is available under Marquee's issuer profile
on SEDAR at www.sedar.com.
The forward-looking information contained in this press release
is made as of the date hereof and the Company undertakes no
obligation to update publicly or revise any forward-looking
information, whether as a result of new information, future events
or otherwise, unless required by applicable securities laws. The
forward looking information contained in this press release is
expressly qualified by this cautionary statement.
ADDITIONAL ADVISORIES
Boes are presented on the basis of one Boe for six Mcf of
natural gas. Disclosure provided herein in respect of Boe 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. 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 6:1, utilizing a conversion on a 6:1 basis may be misleading as
an indication of value.
Neither the TSX Venture Exchange nor its Regulation Services
Provider (as that term is defined in the policies of the TSX
Venture Exchange) accepts responsibility for the adequacy or
accuracy of this release.
SOURCE Marquee Energy Ltd.