CALGARY, AB–(Marketwired – October 20, 2014) – Tourmaline Oil Corp. (TSX: TOU) (“Tourmaline” or the “Company”) is pleased to announce that two new gas facilities, the Musreau Alberta and Doe B.C. 50 mmcfpd plant expansions, were successfully commissioned last week. With the start up of the two projects, daily production has reached a record 136,000 boepd. The Doe B.C. facility start-up has allowed for a 20 mmcfpd net production increase thus far, with a further 30 mmcfpd to be realized in mid-November with the start-up of the associated Sunrise 15-34 compression expansion. Musreau and Doe are the second and third of the five new facilities coming on-stream during the fourth quarter of 2014. The new Spirit River AB gas plant start-up in November and the Wild River AB plant expansion in December will result in the planned 2014 production exit volumes of 150,000 – 155,000 boepd or greater. The Company is currently anticipating average production of 164,500 boepd for 2015.
Start-up of all five Tourmaline operated 2H 2014 facility projects were delayed approximately six weeks from the original on-stream dates established during the first quarter of 2014. These delays will reduce the full year 2014 average production volume estimate by approximately 5,500 boepd. Ongoing, unplanned mainline pipeline maintenance on the TCPL, Spectra and Alliance systems and ongoing TCPL activities on the Robb lateral have resulted in an incremental 3,000 boepd of unscheduled downtime for the year thus far. Consequently, Tourmaline is reducing the full year average production estimate to 115,000 boepd from 120,000 boepd. The revised estimate represents 54% year-over-year growth in average annual production.
Third quarter 2014 production was reduced by the aforementioned mainline pipeline systems maintenance, the TCPL Robb lateral integrity investigation (2,000 boepd), the loss of liquid volumes at the third party Saturn deep-cut facility due to an equipment failure in September (4,000 boepd reduction), and unscheduled maintenance at the third-party Musreau AB facility where Tourmaline delivers excess gas volumes (1,500 boepd). As a result, third quarter 2014 production averaged approximately 108,000 boepd; fourth quarter 2014 production is expected to average between 135,000 and 140,000 boepd. Average production for the first nine months of 2014 is approximately 107,000 boepd, representing a 51% increase over last year’s average production for the same period.
Tourmaline continues to operate 20 drilling rigs and has rig released 102 new wells since spring break-up (91 operated, 11 outside operated). The Company is now expecting to drill and complete 195 wells between mid-May 2014 and March 2015, with essentially all of these wells on-stream by the second quarter of 2015.
Tourmaline will issue Q3 results as well as an updated financial and operational forecast after the market closes on November 5, 2014.
This press release contains forward-looking information within the meaning of applicable securities laws. The use of any of the words “forecast”, “expect”, “anticipate”, “continue”, “estimate”, “objective”, “ongoing”, “may”, “will”, “project”, “should”, “believe”, “plans”, “intends” and similar expressions are intended to identify forward-looking information. More particularly and without limitation, this press release contains forward-looking information concerning Tourmaline’s plans and other aspects of its anticipated future operations, management focus, objectives, strategies, financial, operating and production results and business opportunities, including anticipated petroleum and natural gas production for various periods, cash flows, capital spending, projected operating and drilling costs, the timing for facility expansions and facility start-up dates, as well as Tourmaline’s future drilling prospects and plans, business strategy, future development and growth opportunities, prospects and asset base. The forward-looking information is based on certain key expectations and assumptions made by Tourmaline, including expectations and assumptions concerning: prevailing commodity prices and exchange rates; applicable royalty rates and tax laws; interest rates; future well production rates and reserve volumes; operating costs the timing of receipt of regulatory approvals; the performance of existing wells; the success obtained in drilling new wells; anticipated timing and results of capital expenditures; the sufficiency of budgeted capital expenditures in carrying out planned activities; the timing, location and extent of future drilling operations; the successful completion of acquisitions and dispositions; the availability and cost of labour and services; the state of the economy and the exploration and production business; the availability and cost of financing, labor and services; and ability to market oil and natural gas successfully.
Although Tourmaline believes that the expectations and assumptions on which such forward-looking information is based are reasonable, undue reliance should not be placed on the forward-looking information because Tourmaline can give no assurances that they will prove to be correct. Since forward-looking information addresses future events and conditions, by its very nature it involves 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: the risks associated with the oil and gas industry in general such as 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 estimates and projections relating to reserves, production, costs and expenses; health, safety and environmental risks; commodity price and exchange rate fluctuations; interest rate fluctuations; marketing and transportation; loss of markets; environmental risks; competition; incorrect assessment of the value of acquisitions; failure to complete or realize the anticipated benefits of acquisitions or dispositions; ability to access sufficient capital from internal and external sources; failure to obtain required regulatory and other approvals; and changes in legislation, including but not limited to tax laws, royalties and environmental regulations. Readers are cautioned that the foregoing list of factors is not exhaustive.
Additional information on these and other factors that could affect Tourmaline, or its operations or financial results, are included in the Company’s most recently filed Management’s Discussion and Analysis (See “Forward-Looking Statements” therein) , Annual Information Form (See “Risk Factors” and “Forward-Looking Statements” therein) and other reports on file with applicable securities regulatory authorities and may be accessed through the SEDAR website (www.sedar.com) or Tourmaline’s website (www.tourmalineoil.com).
The forward-looking information contained in this press release is made as of the date hereof and Tourmaline undertakes no obligation to update publicly or revise any forward-looking information, whether as a result of new information, future events or otherwise, unless expressly required by applicable securities laws.
Additional Reader Advisories
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. As the value ratio between natural gas and crude oil based on the current prices of natural gas and crude oil is significantly different from the energy equivalency of 6:1, utilizing a 6:1 conversion basis may be misleading as an indication of value.
|boe||barrel of oil equivalent|
|boepd||barrel of oil equivalent per day|
|mmcf||million cubic feet|
|mcf||thousand cubic feet|
|mmcfpd||million cubic feet per day|
About Tourmaline Oil Corp.
Tourmaline is a Canadian intermediate crude oil and natural gas exploration and production company focused on long-term growth through an aggressive exploration, development, production and acquisition program in the Western Canadian Sedimentary Basin.