CALGARY, Nov. 19, 2013 /CNW/ – Longview Oil Corp. (“Longview” or the “Company”) announces a modest increase in the 2013 capital expenditure program from $36 million to $39 million and revised guidance for the year ending December 31, 2013. The increase in capital expenditures will be directed towards the drilling of three additional wells in SE Saskatchewan targeting the Mississippian Midale formation which will help accelerate our 2014 drilling program.
- The following table summarizes revised operational and financial guidance for Longview for the year ending December 31, 2013:
|2013 Revised Guidance|
|Average production for 2013||6,000 boe/d to 6,100 boe/d|
|% oil & liquids||80%|
|Royalty rate||17% to 18%|
|Operating expenses||$20.00/boe to $21.00/boe|
|Capital expenditures||$39 million|
- Based on the mid-range of guidance, funds from operations for 2013 are estimated at approximately $64 million. Commodity price assumptions include: WTI crude oil price of $97.75 US/bbl, Edmonton light crude oil price of $93.00 Cdn/bbl, a Cdn/U.S. exchange rate of $0.97 and an AECO natural gas price of $3.05 Cdn/mcf.
- Total dividends and capital expenditures as a percentage of funds from operations (“Payout Ratio”) are estimated to be approximately 102% for the 2013 year.
Certain information regarding Longview set forth in this press release, including management’s assessment of the Company’s future plans and operations, contains forward-looking statements that involve substantial known and unknown risks and uncertainties. The use of any of the words “anticipate”, “continue”, “estimate”, “expect”, “may”, “will”, “project”, “should”, “believe” and similar expressions are intended to identify forward looking statements. Such statements represent Longview’s internal projections, estimates or beliefs concerning, among other things, an outlook on the estimated amounts and timing of capital expenditures or other expectations, beliefs, plans, objectives, assumptions, intentions or statements about future events or performance. These statements are only predictions and actual events or results may differ materially. Although Longview believes that the expectations reflected in the forward-looking statements are reasonable, it cannot guarantee future results, levels of activity, performance or achievement since such expectations are inherently subject to significant business, economic, competitive, political and social uncertainties and contingencies. Many factors could cause Longview’s actual results to differ materially from those expressed or implied in any forward-looking statements made by, or on behalf of, Longview.
In particular, forward-looking statements included in this press release include, but are not limited to, the 2013 revised guidance; statements with respect to targeted average production; expected operating expenses for the year ended December 31, 2013; future royalty rates; projected capital expenditures for the year ended December 31, 2013; the focus of and timing of capital expenditures; drilling plans; timing of drilling of rigs; and crude oil and natural gas production levels. The payment and the amount of dividends declared in any month will be subject to the discretion of the board of directors and may vary depending on a variety of factors, including fluctuations in commodity prices, production levels, capital expenditure requirements, debt service requirements, operating costs, royalty burdens and foreign exchange rates.
These forward-looking statements are subject to numerous risks and uncertainties, certain of which are beyond the Company’s control, including the impact of general economic conditions; volatility in market prices for crude oil and natural gas; industry conditions; volatility of commodity prices; currency fluctuation; imprecision of reserve estimates; liabilities inherent in crude oil and natural gas operations; environmental risks; incorrect assessments of the value of acquisitions and exploration and development programs; competition from other producers; the lack of availability of qualified personnel or management; changes in income tax laws or changes in tax laws and incentive programs relating to the oil and gas industry; hazards such as fire, explosion, blowouts, cratering, and spills, each of which could result in substantial damage to wells, production facilities, other property and the environment or in personal injury; stock market volatility; ability to access sufficient capital from internal and external sources and the other risks considered under “Risk Factors” in Longview’s Annual Information Form dated March 26, 2013, which is available on www.sedar.com.
With respect to forward-looking statements contained in this press release, Longview has made assumptions regarding: current commodity prices and royalty regimes; availability of skilled labour; timing and amount of capital expenditures; future exchange rates; the price of oil and natural gas; the impact of increasing competition; conditions in general economic and financial markets; availability of drilling and related equipment; effects of regulation by governmental agencies; royalty rates and future operating costs.
Management has included the above summary of assumptions and risks related to forward-looking information provided in this press release in order to provide shareholders with a more complete perspective on Longview’s future operations and such information may not be appropriate for other purposes. Longview’s actual results, performance or achievement could differ materially from those expressed in, or implied by, these forward-looking statements and, accordingly, no assurance can be given that any of the events anticipated by the forward-looking statements will transpire or occur, or if any of them do so, what benefits that the Company will derive there from. Readers are cautioned that the foregoing lists of factors are not exhaustive. These forward-looking statements are made as of the date of this press release and the Company disclaims any intent or obligation to update publicly any forward-looking statements, whether as a result of new information, future events or results or otherwise, other than as required by applicable securities laws.
“boes” may be misleading, particularly if used in isolation. A boe conversion ratio of six thousand cubic feet of natural gas to one barrel of oil equivalent (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.
SOURCE Longview Oil Corp.
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