Zodiac Exploration Announces 2011 Budget Approval
19 October 2010 - 12:00AM
Marketwired
Zodiac Exploration Inc. ("Zodiac" or the "Company") (TSX VENTURE:
ZEX) announces that the capital and operating budget for fiscal
2011 has been approved by its Board of Directors. The Company plans
a total capital expenditure program of $41.9 million which includes
the drilling and completions of wells in its Jaguar prospect in the
San Joaquin Valley (California, USA); associated facilities
infrastructure; land acquisitions and additional geological &
geophysical expenditures. The 2011 budget is subject to quarterly
review and potential revision to account for the results of actual
operations.
Priorities for 2011 include:
-- Drill & complete a 100% working interest vertical well to test the
Vaqueros formation;
-- Drill & complete 3 gross (1.9 net) additional horizontal wells to prove
horizontal hypothesis and achieve production (plus preparatory costs for
well #5);
-- Facilities and Pipeline Infrastructure to support the above;
-- Acquisition and interpretation of G&G data in Zodiac's areas of focus;
and
-- Continued expansion of Zodiac's land base through acquisitions.
2011 Capital Budget
The expected breakdown of the Company's budget is as follows:
$31.2 million for drilling and completions work; $4.5 million for
facilities and pipeline work; $3.4 million for land; and $2.8
million for seismic and geology. The Company expects that it will
be able to improve on the per well drilling and completions costs
once it proceeds from the evaluation stage to the development stage
of the project's development.
Zodiac's 2011 capital budget has been designed to be
self-sufficient within the Company's projected fiscal capacity,
including working capital carried forward from the 2010 fiscal year
ended September 30, 2010. The budget assumes that no additional
funds will be utilized from other sources such as equity financing,
corporate debt or asset sales. The budget has been prepared based
on several assumptions regarding projected capital expenditures and
pricing estimates extrapolated from current costs and historical
events. Zodiac has the flexibility to expand, reduce or defer its
capital program if available funds exceed or fall short of its
projections in the 2011 budget. Decisions regarding which, if any,
of these options are to be pursued will be dependent upon
availability of capital and other information obtained as
operations progress. Zodiac intends to monitor cash flow closely
and adjust capital expenditures accordingly.
Zodiac intends to post an updated corporate presentation to its
website http://www.zodiacexploration.ca on or before November 3,
2010.
Forward Looking Statements
This press release contains certain forward-looking statements
and forward-looking information (collectively referred to herein as
"forward-looking statements") within the meaning of applicable
securities laws. All statements other than statements of historical
fact are forward-looking statements. Forward-looking information
typically contains statements with words such as "anticipate",
"believe", "plan", "continuous", "estimate", "expect", "may",
"will", "project", "should", or similar words suggesting future
outcomes. In particular, this press release contains
forward-looking statements pertaining to the following: the
Company's planned 2011 capital budget, including expected capital
expenditures, costs, production, and the Canada - U.S. exchange
rate; the Company's 2011 drilling, completion, facility and
pipeline plans; and the posting of an updated corporate
presentation on the Company's website.
Forward-looking information is based on the opinions and
estimates of management at the date the statements are made, and
are subject to a variety of risks and uncertainties and other
factors (many of which are beyond the control of Zodiac) that could
cause actual events or results to differ materially from those
anticipated in the forward-looking information. Some of the risks
and other factors could cause results to differ materially from
those expressed in the forward-looking information include, but are
not limited to: general economic conditions in Canada, the United
States and globally, the risks associated with the oil and gas
industry, commodity prices and exchange rate changes. Industry
related risks could include, but are not limited to: operational
risks in exploration, development and production; delays or changes
in plans; competition for and/or inability to retain drilling rigs
and other services; competition for, among other things, capital,
acquisitions of reserves, undeveloped lands, skilled personnel and
supplies; risks associated to the uncertainty of reserve estimates;
governmental regulation of the oil and gas industry, including
environmental regulation; geological, technical, drilling and
processing problems and other difficulties in producing reserves;
the uncertainty of estimates and projections of production, costs
and expenses; unanticipated operating events or performance which
can reduce production or cause production to be shut in or delayed;
incorrect assessments of the value of acquisitions; the need to
obtain required approvals from regulatory authorities; stock market
volatility; volatility in market prices for oil and natural gas;
liabilities inherent in oil and natural gas operations; access to
capital; and other factors. Readers are cautioned that this list of
risk factors should not be construed as exhaustive.
In addition to other factors and assumptions which may be
identified in this press release, assumptions have been made
regarding, among other things: the timing and costs of drilling,
completion, facility and pipeline expenditures; currency, exchange
and interest rates; the regulatory framework regarding royalties,
taxes and environmental matters in the jurisdictions in which the
Company operates; the ability of the Company to obtain and retain
qualified staff, equipment and services in a timely and cost
efficient manner; and the general stability of the economic and
political environment in which the Company operates. Readers are
cautioned that the foregoing list of factors is not exhaustive.
The forward-looking information contained in this news release
is expressly qualified by this cautionary statement. Zodiac does
not undertake any obligation to update or revise any
forward-looking statements to conform such information to actual
results or to changes in our expectations except as otherwise
required by applicable securities legislation. Readers are
cautioned not to place undue reliance on forward-looking
information.
(i) Unless otherwise noted all figures are denominated in $US
currency
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.
Contacts: Zodiac Exploration Inc. Murray Rodgers President &
CEO (403) 444-7844 Zodiac Exploration Inc. Randy Neely Chief
Financial Officer (403) 444-7848 www.zodiacexploration.ca
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