CALGARY, Aug. 17, 2015 /CNW/ – Seven Generations Energy Ltd. (Seven Generations or 7G) has entered into an agreement with Tenaska Marketing Canada and Tenaska Marketing Ventures (Tenaska) that will see Tenaska manage 7G's expanding natural gas transportation capacity on Alliance Pipeline to the U.S. Midwest.
“Tenaska is a leading North American energy firm with the gas marketing expertise and market connections to help optimize the value of our growing sales in the U.S. Midwest. This arrangement will strengthen our ability to market natural gas in one of the continent's largest energy markets,” said Pat Carlson, 7G's Chief Executive Officer.
Seven Generations holds transportation capacity that grows incrementally over the next three years on Alliance Pipeline – a liquids-rich conduit that will allow 7G to start flowing 250 million cubic feet per day of rich gas as of December 1, 2015. Transportation commitments step up to reach 500 million cubic feet per day in 2018. Under the agreement, Tenaska will manage the day-to-day capacity and transportation of 7G's liquids-rich natural gas on Alliance from 7G's Kakwa River Project in northwest Alberta to natural gas buyers in the Chicago area.
“We are excited about the opportunity to align with Seven Generations through this asset management arrangement. We believe that our experience and physical asset expertise will assist Seven Generations in maximizing the value of its natural gas production,” said Fred Hunzeker, President and CEO, Tenaska Marketing Group.
Tenaska is among the top five natural gas marketers in North America and ranks first in gas pipeline trading release capacity. In 2014, it sold or managed approximately 2.5 trillion cubic feet of natural gas, or about 9.4 percent of the total U.S. natural gas consumption.
Seven Generations is a low-cost, high-growth Canadian gas developer generating long-life value from its liquids-rich, natural gas Kakwa River Project, located about 100 kilometres south of its operations headquarters in Grande Prairie, Alberta. 7G's corporate headquarters are in Calgary and its shares trade on the TSX under the symbol VII.
This news release contains certain forward-looking information and statements that involves various risks, uncertainties and other factors. The use of any of the words “anticipate”, “continue”, “estimate”, “expect”, “may”, “will”, “should”, “believe”, “plans”, and similar expressions are intended to identify forward-looking information or statements. In particular, but without limiting the foregoing, this news release contains forward-looking information and statements pertaining to the following: the management and value optimization of natural gas that is produced and sold to the U.S. Midwest; the benefits to be derived from the asset management agreement; production growth, delivery and profitability.
With respect to forward-looking information contained in this news release, assumptions have been made regarding, among other things: future oil, natural gas liquids and natural gas prices; 7G's ability to obtain qualified staff and equipment in a timely and cost efficient manner; 7G's ability to market production of oil, natural gas liquids and natural gas successfully to customers; 7G's future production levels; the applicability of technologies for 7G's reserves and resources; future capital investments by 7G; future funds from operations from production; future sources of funding for 7G's capital program; 7G's future debt levels; geological and engineering estimates in respect of 7G's reserves and resources, the geography of the areas in which 7G is conducting exploration and development activities, and the access, economic and physical limitations to which 7G may be subject from time to time; the impact of competition on 7G; and 7G's ability to obtain financing on acceptable terms.
Actual results could differ materially from those anticipated in this forward-looking information as a result of the risks and risk factors that are set forth in 7G's Annual Information Form, dated March 10, 2015, which is available on SEDAR at www.sedar.com, including, but not limited to: volatility in market prices and demand for oil, natural gas liquids and natural gas and hedging activities related thereto; general economic, business and industry conditions; variance of 7G's actual capital costs, operating costs and economic returns from those anticipated; risks related to the exploration, development and production of oil and natural gas reserves and resources; negative public perception of oil sands development, oil and natural gas development and transportation, hydraulic fracturing and fossil fuels; actions by governmental authorities, including changes in government regulation, royalties and taxation; the management of 7G's growth; the availability, cost or shortage of rigs, equipment, raw materials, supplies or qualified personnel; the absence or loss of key employees; uncertainty associated with estimates of oil, natural gas liquids and natural gas reserves and resources and the variance of such estimates from actual future production; dependence upon compressors, gathering lines, pipelines and other facilities, certain of which 7G does not control; the ability to satisfy obligations under 7G's firm commitment transportation arrangements; uncertainties related to 7G's identified drilling locations; the concentration of 7G's assets in the Kakwa area; unforeseen title defects; First Nations claims; failure to accurately estimate abandonment and reclamation costs; changes in the interpretation and enforcement of applicable laws and regulations; terrorist attacks or armed conflicts; reassessment by taxing authorities of 7G's prior transactions and filings; variations in foreign exchange rates and interest rates; third-party credit risk including risk associated with counterparties in risk management activities related to commodity prices and foreign exchange rates; sufficiency of insurance policies; potential for litigation; variation in future calculations of non-IFRS measures; sufficiency of internal controls; impact of expansion into new activities on risk exposure; risks related to the senior unsecured notes and other indebtedness, including: potential inability to comply with the covenants in the credit agreement related to 7G's credit facilities and/or the covenants in the indentures in respect of 7G's senior secured notes; seasonality of 7G's activities and the Canadian oil and gas industry; and extensive competition in 7G's industry.
The forward-looking information and statements contained in this news release speak only as of the date hereof, and 7G does not assume any obligation to publicly update or revise them to reflect new events or circumstances, except as may be required pursuant to applicable laws.
SOURCE Seven Generations Energy Ltd.