CALGARY,
Nov. 4, 2013 /CNW/ -
(TSXV:TOL) TriOil Resources Ltd. ("TriOil" or the "Company")
is pleased to provide an operations update on the Company's
Montney, Cardium and Dunvegan programs.
Montney Operations
TriOil recently completed and brought on production its second
horizontal Montney well. Over its
initial 5 days of production, this well has produced at an average
rate of approximately 950 BOE/d (51 percent NGLs) TriOil owns a 61%
working interest in this well and plans to drill 2 to 3 follow up
wells in the first half of 2014.
Current corporate production from the Company's Montney project is approximately 1,150 BOE/d
(30% NGLs).
Cardium Operations
TriOil drilled its first long-reach horizontal Cardium well on
the Western Lochend trend in late 2012. The well was drilled to a
total depth of 5,402 metres with a horizontal length of 2,867
metres and was completed with a 40 stage slickwater fracture
stimulation. The well averaged 336 BOE/d (89% oil) in its initial
30 calendar days of production and has exhibited lower declines
than our typical 1 mile horizontal Lochend Cardium wells. After 8
months of production the well is currently producing approximately
240 BOE/d (80% oil).
The Company brought its second long-reach horizontal Cardium
well in Western Lochend on production in October, 2013. This well
was drilled to a total depth of 5,407 metres with a horizontal
length of 2,858 metres and was completed with a 36 stage slickwater
fracture stimulation. Over its initial 30 calendar days of
production the well averaged 587 BOE/d (79% oil).
TriOil recently drilled a third long-reach horizontal Cardium
well in Western Lochend to a total depth of 5,301 metres with a
horizontal length of 2,867 metres and completed the well with a 36
stage slickwater fracture stimulation. The well is currently being
flow tested and we expect that it will be equipped and on
production in December 2013.
TriOil owns a 50 percent working interest in each of these
long-reach horizontal Cardium oil wells and has a large development
drilling inventory offsetting these wells.
In Central Lochend, TriOil recently drilled 1 (0.5 net) Cardium
horizontal well and is currently drilling a second (0.5 net)
Cardium horizontal well from the same pad. Both wells are expected
to be completed with 18-20 stage slickwater fractures stimulations
in November and brought on production in December, 2013.
TriOil is currently drilling a 100% working interest horizontal
Cardium well on its Western Lochend acreage. Completion operations
on this well are planned for December, 2013.
Current corporate production from the Company's Cardium project
is approximately 1,050 BOE/d (67% oil and NGLs).
Dunvegan Operations
TriOil recently completed and brought on production 2 (1.36 net)
horizontal Dunvegan light oil
wells at Kaybob. The 2 wells have produced at a combined average
rate of approximately 1,200 BOE/d (88% oil) over their initial 18
days of production.
Current corporate production from the Company's Dunvegan project is approximately 2,100 BOE/d
(74% oil).
Guidance
Based on field estimates, the Company's average October
production was approximately 4,100 BOE/d (62% oil and NGLs) and
current production exceeds 4,500 BOE/d (62% oil and NGLs). TriOil
remains on track to meet or exceed its 2013 exit production
guidance of 4,400 BOE/d.
Upcoming Shareholders Meeting
As announced on September
16, 2013, the Company entered into an agreement (the
"Arrangement Agreement") with ORLEN Upstream s.p. z.o.o.
("Orlen Upstream") pursuant to which Orlen Upstream, through
a wholly owned subsidiary Orlen Upstream International BV
("Orlen Upstream International"), agreed to purchase all of
the issued and outstanding class A common shares or the Company
(the "Common Shares") at a cash price of CAN $2.85 per Common Share. The transaction is
to be completed by way of a plan of arrangement under the
Business Corporations Act (Alberta) (the "Arrangement"). The
Arrangement is subject to customary conditions for a transaction of
this nature, which include Court approvals, the approval of 66 2/3
percent of TriOil shareholders represented in person or by proxy at
the special meeting of shareholders of TriOil to consider the
Arrangement and a "majority minority approval" after excluding
votes cast in respect of Common Shares held by certain directors
and officers of the Company.
The special meeting of the holders of Common
Shares is scheduled for Tuesday, November
12, 2013 at 9:30 a.m.
(Calgary time) at the John Laurie
Room of the Bow Valley Club, 250 - 6th Avenue SW,
Calgary, Alberta. An
application to the Court of Queen's Bench of Alberta (the "Court") is scheduled for
10:00 a.m. (Calgary time) on November 13, 2013 to consider the fairness of the
Arrangement. If approved by shareholders and the Court and
all other conditions to closing are satisfied, the Arrangement is
expected to close shortly thereafter.
TriOil is a Calgary,
Alberta based company engaged in the exploration,
development and production of petroleum and natural gas.
TriOil trades on the TSX Venture Exchange under
the symbol "TOL". As of November 1,
2013, there are approximately 64.0 million shares issued and
outstanding (70.1 million fully diluted).
Forward Looking Statements
This news release contains forward-looking
information and forward-looking statements within the meaning of
applicable securities laws. The use of any of the words "expect",
"seek", "anticipate", "continue", "estimate", "approximate",
"believe", "plans", "intends", "confident", "may", "objective",
"ongoing", "will", "should", "project", "predict", "potential",
"targeting", "could", "would", and similar expressions are intended
to identify forward-looking information. More particularly, this
document contains forward looking statements and information which
include, but are not limited to, expected future drilling and
completion plans, expected capital expenditures, expected
production and reserves growth, expectations of the effect of
drilling and completion programs on productivity, recoveries and
costs and the future operations of TriOil, the timing and
anticipated receipt of required regulatory, court, and shareholder
approvals for the Arrangement; and the anticipated timing of the
closing of the Arrangement.
The forward-looking statements contained in this
document are based on certain key expectations and assumptions made
by TriOil, including with respect to the anticipated exploration
and development opportunities and the outlook for the fiscal year
ending December 31, 2013,
expectations and assumptions concerning the success of future
exploration and development activities, production guidance, the
performance of new wells and drilling and completion programs,
prevailing commodity prices and the availability of additional
capital if and when required by the Company.
Although TriOil believes that the expectations
and assumptions on which the forward-looking statements are based
are reasonable, undue reliance should not be placed on the
forward-looking statements because TriOil can give no assurance
that they will prove to be correct. Since forward-looking
statements address future events and conditions, by their very
nature they involve inherent risks and uncertainties. Actual
results could differ materially from those currently anticipated
due to a number of factors and risks. These include, but are not
limited to, the failure to satisfy the conditions to closing the
Arrangement, risks associated with the oil and gas industry in
general (e.g., operational risks in development, exploration and
production; delays or changes in plans with respect to exploration
or development projects or capital expenditures; the uncertainty of
reserve estimates; the uncertainty of estimates and projections
relating to production, costs and expenses, and health, safety and
environmental risks), commodity price and exchange rate
fluctuations and uncertainties resulting from potential delays or
changes in plans with respect to exploration or development
projects or capital expenditures. Certain of these risks are set
out in more detail in TriOil's Annual Information Form which has
been filed on SEDAR and can be accessed at www.sedar.com and
TriOil's other public disclosure documents which have been filed on
SEDAR and can be accessed at www.sedar.com.
Risks and uncertainties inherent in the nature
of the Arrangement include the failure of TriOil or ORLEN Upstream
to obtain necessary securityholder, regulatory, court and other
third party approvals, or to otherwise satisfy the conditions to
the Arrangement, in a timely manner, or at all. Failure to so
obtain such approvals, or the failure of TriOil or ORLEN Upstream
to otherwise satisfy the conditions to the Arrangement, may result
in the Arrangement not being completed on the proposed terms, or at
all. In addition, the failure of TriOil to comply with certain
terms of the Arrangement Agreement may result in TriOil being
required to pay a non-completion fee to ORLEN Upstream
International, the result of which could have a material adverse
effect on TriOil's financial position and results of operations and
its ability to fund growth prospects and current operations.
The forward-looking statements contained in this
press release are made as of the date hereof and TriOil undertakes
no obligation 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.
Any references in this news release to test
rates or initial production rates ("IP"), including IP rates of 30
days or less, are useful in confirming the presence of
hydrocarbons, however, such rates are not necessarily indicative of
long-term performance or ultimate recovery and such rates are not
determinative of the rates at which such wells will continue
production and decline thereafter. Additionally, such rates may
also include recovered "load oil" fluids used in well completion
stimulation. While encouraging, readers are cautioned not to place
reliance on such rates in calculating the aggregate production for
the Company.
Meaning of BOE
The term "BOE" may be misleading, particularly
if used in isolation. A BOE conversion 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. All BOE
conversions in this report are derived from converting gas to oil
in the ratio of six thousand cubic feet of gas to one barrel of
oil.
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 TriOil Resources Ltd.