Note: | |
(1) | Such terms do not have a standardized meaning prescribed by International Financial Reporting Standards. Refer to the Cautionary Statements at the end of this news release. |
Crew is investing approximately $34 million in 2014 on the construction of a new gas plant and pre-drilled wells anticipated to begin production in the second half of 2015 that will not contribute production or funds from operations in 2014. These investments are expected to form the foundation of steady and prolonged production growth from the Montney contributing to corporate production targeting greater than 40,000 boe per day at the end of 2015 based on Crew’s long range strategic planning.
Our 2014 budget guidance and 2015 targets are best estimates based on certain assumptions including, without limitation, operating results, known fiscal regimes and commodity prices and will be regularly monitored by management. Our objectives will be to proactively manage our capital program as it relates to operational success and fluctuating commodity prices with a priority to maintain financial flexibility and achieve our production guidance. Additional information regarding our 2014 budget can be found within the latest presentation on the Company’s website at www.crewenergy.com.
CAUTIONARY STATEMENTS
Forward-looking information and statements
The Company anticipates remaining disciplined but flexible with its 2014 exploration and development capital expenditures as it monitors business conditions and commodity prices throughout the fiscal year. Where deemed prudent, it may make adjustments to its 2014 capital budget. Actual spending may vary due to a variety of factors, including drilling results, crude oil and natural gas prices, economic conditions, prevailing debt and/or equity markets, field services and equipment availability, and any future strategic acquisitions or dispositions. The Company has flexibility to adjust the level of its capital investments as circumstances warrant.
This news release contains certain forward-looking information and statements within the meaning of applicable securities laws. The use of any of the words “expect”, “anticipate”, “continue”, “estimate”, “forecast”, “target”, “may”, “will”, “project”, “should”, “believe”, “plans”, “intends” and similar expressions are intended to identify forward-looking information or statements. In particular, but without limiting the forgoing, this news release contains forward-looking information and statements pertaining to the following: the Company’s planned 2014 capital expenditure program, goals and drilling plans, estimated, expected and targeted production levels in 2014 and 2015 and commodity mix; future commodity prices, the future differential between WTI prices and WCS prices, future royalty rates, the future exchange rate for the Canadian dollar to the US dollar, operating costs and projected decreases in same, transportation costs, general and administrative costs, interest costs, the Company’s cash flow from operations and anticipated improvements in funds from operations netbacks, the Company’s estimated 2014 year end bank debt, future results from operations; future development and exploration activities, infrastructure additions, expansions and related capital expenditures, the timing thereof and adequacy of anticipated methods of financing, the number of wells to be drilled and completed and related production expectations; and the amount and timing of capital projects.
Forward-looking statements or information are based on a number of material factors, expectations or assumptions of Crew which have been used to develop such statements and information but which may prove to be incorrect. Although Crew believes that the expectations reflected in such forward-looking statements or information are reasonable, undue reliance should not be placed on forward-looking statements because Crew can give no assurance that such expectations will prove to be correct. In addition to other factors and assumptions which may be identified herein, assumptions have been made regarding, among other things: the impact of increasing competition; the general stability of the economic and political environment in which Crew operates; the timely receipt of any required regulatory approvals; the ability of Crew to obtain qualified staff, equipment and services in a timely and cost efficient manner; drilling results; the ability of the operator of the projects in which Crew has an interest in to operate the field in a safe, efficient and effective manner; the ability of Crew to obtain financing on acceptable terms; field production rates and decline rates; the ability to replace and expand oil and natural gas reserves through acquisition, development and exploration; the timing and cost of pipeline, storage and facility construction and expansion and the ability of Crew 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 Crew operates; the ability of Crew to successfully market its oil and natural gas products; ability to improve upon historical recovery factors.
The forward-looking information and statements included in this news release are not guarantees of future performance and should not be unduly relied upon. Such information and statement, including the assumptions made in respect thereof, involve known and unknown risks, uncertainties and other factors that may cause actual results or events to defer materially from those anticipated in such forward-looking information or statements including, without limitation: changes in commodity prices; changes in the demand for or supply of Crew’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 Crew or by third party operators of Crew’s properties, increased debt levels or debt service requirements; inaccurate estimation of Crew’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 Crew’s public disclosure documents, (including, without limitation, those risks identified in this news release and Crew’s Annual Information Form).
The forward-looking information and statements contained in this news release speak only as of the date of this news release, and Crew does not assume any obligation to publicly update or revise any of the included forward-looking statements or information, whether as a result of new information, future events or otherwise, except as may be required by applicable securities laws.
BOE equivalent
Barrel of oil equivalents or BOEs may be misleading, particularly if used in isolation. A BOE conversion ratio of 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. 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 6:1 conversion may be misleading as an indication of value.
Resource Estimates
This news release contains references to estimates of oil and gas classified as Total Petroleum Initially In Place (“TPIIP”) in the Montney region in northeastern British Columbia which are not, and should not be confused with, oil and gas reserves. Such estimates are based upon independent resource evaluations effective as at April 30, 2013 and May 31, 2013, respectively, prepared in accordance with the Canadian Oil and Gas Evaluation Handbook. Such estimates are subject to a number of cautionary statements, assumptions, risks, positive and negative factors relevant to the estimates and contingencies, the details of which were set forth in Crew’s previously disseminated press release dated July 9, 2013. Accordingly, readers are referred to and encouraged to review the sections entitled “Montney Resource Evaluation”, “Definitions of Oil and Gas Resources and Reserves” and “Information Regarding Disclosure on Oil and Gas Reserves, Resources and Operational Information” in the July 9, 2013 press release for applicable definitions, cautionary language, explanations and discussion of resources estimated herein, all of which is incorporated herein by reference.
Crew is a Calgary, Alberta based oil and gas exploration, development and production company whose shares are traded on the Toronto Stock Exchange under the trading symbol “CR”.