CALGARY, ALBERTA–(Marketwire – March 21, 2013) –
Donnycreek Energy Inc. (“Donnycreek” or the “Company“) (TSX VENTURE:DCK) reports that the third horizontal Kakwa Montney well 03-19-63-5 W6M (the “3-19 Well“) has been successfully completed and tested. The well was flow-tested for 161 hours. During the final 24 hours of flow-back the well averaged gross production rates of 1,798 boe/d consisting of 826 bbl/d condensate and 5,833 mscf/d natural gas (413 bbl/d and 2,917 mscf/d, or 899 boe/d combined, net to Donnycreek) against anticipated gathering system pressure of approximately 5,000 kPa.
The successful drilling and completion of the 3-19 Well continues to demonstrate that Donnycreek’s Kakwa lands are in the heart of the liquids-rich Montney trend, validating the repeatability of this prolific play.
Equipping and facilities work will begin immediately to add additional liquids handling equipment on site that will accommodate both the 3-19 Well and the previously announced second horizontal Kakwa Montney well 14-30-63-5 W6M (the “14-30 Well“), drilled from the same surface location. It is currently anticipated that production from both wells will commence in mid-April.
The Company anticipates the drilling of the next well on the Company’s 50% Kakwa block to commence post-break up.
The Company advises that although the initial rates from the 3-19 Well are very encouraging, production test results are not necessarily indicative of long-term performance or of ultimate recovery from the 3-19 Well.
About Donnycreek Energy Inc.
Donnycreek is a Calgary-based public oil and gas company which holds 244 gross sections (176 net sections) of petroleum and natural gas rights, with an average working interest of approximately 72%, prospective primarily for Montney liquid rich natural gas resource development in its 3 core areas: Kakwa, Wapiti and Chicken, all of which are located in the Deep Basin area of west central Alberta.
Further information relating to Donnycreek is also available on its website at www.donnycreekenergy.com.
ON BEHALF OF THE BOARD OF DONNYCREEK ENERGY INC.
Malcolm F.W. Todd, Chief Executive Officer
ADVISORY ON FORWARD-LOOKING STATEMENTS: This news release contains certain forward-looking information and statements (“forward-looking statements“) within the meaning of applicable securities laws. The use of any of the words “expect”, “anticipate”, “continue”, “estimate”, “may”, “will”, “project”, “should”, “believe”, “plans”, “intends” and similar expressions are intended to identify forward-looking statements. In particular, but without limiting the forgoing, this press release contains statements concerning the anticipated gathering system pressure for the 3-19 Well, the equiping of additional liquids handling equipment, the timing of production of the 3-19 Well and the 14-30 Well, the timing of the next well on the Company’s 50% Kakwa block and the prospective zone for development on the Company’s lands.
Forward-looking statements are based on a number of material factors, expectations or assumptions of Donnycreek which have been used to develop such statements and information but which may prove to be incorrect. Although Donnycreek believes that the expectations reflected in these forward-looking statements are reasonable, undue reliance should not be placed on them because Donnycreek 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. In particular, in addition to other factors and assumptions which may be identified herein, no assurances can be given respecting: whether the Company’s exploration and development activities respecting its prospects, including the wells discussed herein, will be successful or that material volumes of petroleum and natural gas reserves will be encountered, or if encountered can be produced on a commercial basis; the ultimate size and scope of any hydrocarbon bearing formations on its lands; that drilling operations on its lands, including the wells discussed herein, will be successful such that further development activities in these areas are warranted; that Donnycreek’s efforts to raise additional capital will be successful; that Donnycreek will continue to conduct its operations in a manner consistent with past operations; results from drilling and development activities will be consistent with past operations; the accuracy of the estimates of Donnycreek’s reserve volumes; the general stability of the economic and political environment in which Donnycreek operates; drilling results; field production rates and decline rates; the general continuance of current industry conditions; the timing and cost of pipeline, storage and facility construction and expansion and the ability of Donnycreek to secure adequate product transportation; future commodity prices; currency, exchange and interest rates; regulatory framework regarding royalties, taxes and environmental matters in the jurisdictions in which Donnycreek operates; and the ability of Donnycreek to successfully market its oil and natural gas products.
Further, events or circumstances may cause actual results to differ materially from those predicted as a result of numerous known and unknown risks, uncertainties, and other factors, many of which are beyond the control of the Company, including, without limitation: changes in commodity prices; changes in the demand for or supply of the Company’s products; unanticipated operating results or production declines; changes in tax or environmental laws, royalty rates or other regulatory matters; changes in development plans of Donnycreek or by third party operators of Donnycreek’s properties, increased debt levels or debt service requirements; inaccurate estimation of Donnycreek’s oil and gas reserve and resource volumes; limited, unfavourable or a lack of access to capital markets; increased costs; a lack of adequate insurance coverage; the impact of competitors; and certain other risks detailed from time-to-time in Donnycreek’s public disclosure documents. Additional information regarding some of these risk factors may be found under “Risk Factors” in the Company’s Annual Information Form and its Management’s Discussion and Analysis prepared for the year ended July 31, 2012. The reader is cautioned not to place undue reliance on these forward-looking statements. The forward-looking statements contained in this news release are made as of the date hereof and Donnycreek undertakes no obligations to update publicly or revise any forward-looking statements, whether as a result of new information, future events or otherwise, unless so required by applicable securities laws.
Where amounts are expressed on a barrel of oil equivalent (“BOE“) basis, natural gas volumes have been converted to oil equivalence at six thousand cubic feet per barrel. The term BOE may be misleading, particularly if used in isolation. A BOE conversion ratio of six thousand cubic feet per barrel 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. References to oil in this discussion include crude oil and natural gas liquids (“NGLs“). NGLs include condensate, propane, butane and ethane.
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 NEWS RELEASE.
Donnycreek Energy Inc.
President and Chief Executive Officer
(604) 684-4265 (FAX)