strategy with the investment of approximately $210 million in 2014 for the continuing expansion of the jointly-owned Access Pipeline.
“The diluent recovery facility will have the dual effect of reducing MEG’s requirement for diluent supply, while effectively increasing our rail shipping capacity,” said McCaffrey. “Additionally, our HI-Q™ technology has the potential to offer tremendous benefits as MEG’s production grows. The benefits of shipping HI-Q™ include substantially reduced diluent supply requirements, freeing-up pipeline capacity through the removal of diluent, and expanded market access.”
| 2014 Capital Budget | ||||
| ($ millions) | ||||
| Intraphase growth – RISER 2B | 340 | |||
| Portfolio growth | ||||
| Christina Lake Phase 3A | 275 | |||
| Resource development | 115 | |||
| Growth infrastructure | 85 | |||
| Enhancements and other | 105 | |||
| Marketing initiatives | ||||
| Access expansion | 210 | |||
| Diluent Removal Facility | 75 | |||
| HI-Q Field Demonstration Project | 125 | |||
| Other | 35 | |||
| Sustaining and maintenance | 135 | |||
| Other | 100 | |||
| Base capital program | 1,600 | |||
| Discretionary capital | 200 | |||
| Base plus discretionary capital | 1,800 | |||
Forward-looking information
This news release may contain forward-looking information including but not limited to: expectations of future production, SORs, operating costs and capital investments; the commissioning and start-up of the completed Stonefell terminal; the expansion of the Access pipeline; the impact of MEG’s hub-and-spoke strategy on netbacks and on its exposure to differentials and pipeline restrictions; the anticipated capital requirements, development plans, timing for completion, production declines, accelerated production growth, cashflows, production capacities and performance of the future phases and expansions of the Christina Lake project (including the RISER initiative) and the Surmont project; and the potential financings for MEG’s operations and capital investments. All such forward-looking information is based on management’s expectations and assumptions regarding future growth, results of operations, production, future capital and other expenditures (including the amount, nature and sources of funding thereof), plans for and results of drilling activity, environmental matters, business prospects and opportunities. By its nature, such forward-looking information involves significant known and unknown risks and uncertainties, which could cause actual results to differ materially from those anticipated. These risks include, but are not limited to: risks and delays in the development of or in the production associated with MEG’s projects; the securing of adequate supplies and access to markets and transportation infrastructure; the uncertainty of estimates and projections relating to production, costs and revenues; the availability of take away capacity on the electric transmission grid; health, safety and environmental risks; risks of legislative and regulatory changes to, amongst other things, tax, land use, royalty and environmental laws; changes in commodity prices and foreign exchange rates; and risks and uncertainties associated with securing and maintaining the necessary regulatory approvals and financing to proceed with the development of MEG’s projects and facilities. Although MEG believes that the assumptions supporting such forward-looking information are reasonable, there can be no assurance that such assumptions will be correct. Accordingly, readers are cautioned that the actual results achieved may vary from the forward-looking information provided herein and that the variations may be material. Readers are also cautioned that the foregoing list of assumptions, risks and factors is not exhaustive. For more information regarding forward-looking information see “Risk Factors” and “Regulatory Matters” within MEG’s annual information form dated February 27, 2013 (the “AIF”) along with MEG’s other public disclosure documents. A copy of the AIF and of MEG’s other public disclosure documents is available through the SEDAR website or by contacting MEG’s investor relations department. Guidance regarding capital expenditures may constitute a “financial outlook” as contemplated by National Instrument 51-102 of the Canadian Securities Administrators entitled Continuous Disclosure Obligations. The purpose of such guidance is to forecast the anticipated capital expenditures by MEG in 2014 and such information may not be appropriate for other purposes.
This press release shall not constitute an offer to sell, or the solicitation of an offer to buy, any securities in any jurisdiction. The common shares being offered have not been and will not be registered under the U.S. Securities Act of 1933 and state securities laws.
MEG Energy Corp. is focused on sustainable in situ oil sands development and production in the southern Athabasca oil sands region of Alberta, Canada. MEG is actively developing enhanced oil recovery projects that utilize SAGD extraction methods. MEG’s common shares are listed on the Toronto Stock Exchange under the symbol “MEG.”
SOURCE MEG Energy Corp.
For further information:
Investors
Helen Kelly
Director, Investor Relations
403-767-6206
helen.kelly@megenergy.com
Media
Brad Bellows
Director, External Communications
403-212-8705
brad.bellows@megenergy.com