CALGARY, ALBERTA--(Marketwired - Apr 15, 2013) - PetroBakken Energy Ltd. ("PetroBakken" or the "Company") (PBN.TO) is pleased to provide an update on our first quarter operations. Note that all well counts contained in this press release are net numbers.
Consistent with our capital plan, the first quarter of 2013 was very active as we drilled 53 wells, placed 40 wells on production and exited the quarter with an inventory of 30 wells waiting to be brought on-stream. Although well activity decreased from the fourth quarter of 2012, production continued to grow and averaged 49,079 barrels of oil equivalent per day ("boepd") (82% light oil and liquids weighted) during the first quarter. This represents a 4% increase over our Q4 2012 average production of 47,192 boepd and a 5% increase over Q1 2012. Current production, based on field estimates for the first week of April, is approximately 48,300 boepd, with over 1,600 boepd of production currently restricted due to third party processing capacity limitations.
The majority of our drilling activity occurred in our Bakken and Cardium business units. In the Bakken business unit we drilled 15 wells, placed 14 wells on production and continued to optimize our extensive inventory of existing wells. Production for the quarter averaged approximately 19,000 boepd, which was relatively flat to our fourth quarter 2012 production of 19,700 boepd. Production in the first week of April, based on field estimates, is approximately 19,000 boepd.
In the Cardium business unit we drilled 23 wells and placed 17 wells on production, with the majority of the activity occurring in the West Pembina area of the business unit. At the end of the quarter we had 22 wells waiting to be brought on production and we expect to bring on 10 of these wells prior to activities being restricted by spring break-up conditions. Production for the first quarter averaged approximately 20,600 boepd, an 8% increase over the fourth quarter of 2012. We still have approximately 600 boepd of production restricted in the Lochend region and expect to have it on-stream by the end of the second quarter as facility expansions in the area are completed. Production in the first week of April is approximately 19,300 boepd with more than 1,000 boepd of production in the Brazeau region recently restricted due to increasing line pressures as a result of overall growth in the area. We expect to have this production restored in the third quarter of 2013.
First quarter 2013 production in the southeast Saskatchewan Conventional business unit increased 7% over the fourth quarter of 2012 to approximately 6,100 boepd. We drilled 7 wells in this business unit in the first quarter and placed 8 wells on production. We continued to be active in our new resource play area, particularly in the Swan Hills region where we drilled 5 wells and brought 2 wells on production this quarter. Building on activity initiated in the fourth quarter of 2012, production from the business unit in the first quarter of 2013 grew 21% over the prior quarter to average approximately 3,350 boepd, with 4 wells in inventory waiting to come on-stream. Consistent with our light oil-focused activity, the liquids weighting in this business unit has increased from 40% in the fourth quarter of 2012 to 47% in the first quarter of 2013.
The industry is now entering spring break-up, which is a period of reduced activity in the Western Canadian Sedimentary Basin due to road bans and weather related conditions. While the impact of break-up on our operations is weather dependent, and can sometimes be prolonged by early summer rains, we anticipate seasonal downtime due to restricted operations and we forecast second quarter production will fall from current levels. Our annual forecasts include higher downtime factors for this period. Compared to previous years, we expect the impact of spring break-up to be reduced as our production base is more mature and more wells have been tied-in to infrastructure. In addition, new wells and the de-bottlenecking of restricted production in the Cardium business unit in the second quarter will help mitigate the impact of spring break-up.
The results of our Q1 capital program, combined with our planned activities for the remainder of the year have put us on pace to drill 129 wells in 2013 and achieve our year-over-year average production growth of 8% to 12%. The 2013 capital plan of $675 million is expected to deliver an average daily production rate of 46,000 to 48,000 boepd with an estimated 2013 production exit rate of approximately 49,000 to 52,000 boepd.
PetroBakken Energy Ltd. is an oil and gas exploration and production company combining light oil Bakken and Cardium resource plays with conventional light oil assets, delivering industry leading operating netbacks, strong cash flows and production growth. PetroBakken is applying leading edge technology to a multi-year inventory of Bakken and Cardium light oil development locations, along with a significant inventory of opportunities in the Horn River and Montney gas resource plays in northeast BC. Our strategy is to deliver accretive production and reserves growth, along with an attractive dividend yield.
BOEs. Natural gas volumes have been converted to barrels of oil equivalent ("boe"). Six thousand cubic feet ("Mcf") of natural gas is equal to one barrel of oil equivalent based on an energy equivalency conversion method primarily attributable at the burner tip and does not represent a value equivalency at the wellhead. Boes may be misleading, especially if used in isolation.
Well Counts. All references to well counts are on a net basis.
Forward Looking Statements. Certain information provided in this press release constitutes forward-looking statements. Specifically, this press release contains forward-looking statements relating to future results from operations, future production rates and, proposed exploration and development activities (including the number of wells to be drilled, completed and put on production). The forward-looking statements are based on certain key expectations and assumptions, including expectations and assumptions concerning the success of future drilling, completion, recompletion and development activities, the performance of new and existing wells, prevailing commodity prices and economic conditions, the availability and cost of labour and services, timing of pipeline and facilities construction, access to third party facilities and weather and access to drilling locations. Although we believe 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 we 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, 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, reliance on industry partners, availability of equipment and personnel, uncertainty surrounding timing for drilling and completion activities resulting from weather and other factors, changes in applicable regulatory regimes and health, safety and environmental risks), commodity price and exchange rate fluctuations and general economic conditions. Certain of these risks are set out in more detail in our Annual Information Form which has been filed on SEDAR and can be accessed at www.sedar.com. Except as may be required by applicable securities laws, PetroBakken assumes no obligation to publicly update or revise any forward-looking statements made herein or otherwise, whether as a result of new information, future events or otherwise.