CALGARY, ALBERTA–(Marketwired – Jan. 16, 2017) – NuVista Energy Ltd. (“NuVista” or the “Company”) (TSX:NVA) is pleased to announce a number of updates that demonstrate successful execution of our 2016 plans and strong progress towards our 2017 and beyond plans. Our 2016 full year and fourth quarter guidance expectations have all been met or exceeded, as well results and costs continue to improve and outperform. Specific highlights include the following:
- Field-estimated production for the fourth quarter of 2016 was approximately 24,550 Boe/d, exceeding the previously guided range of 23,500 – 24,500 Boe/d. This figure includes downtime totaling 650 Boe/d due to temporary midstream and downstream pipeline maintenance. Our 2016 full year production estimate met the lower end of the original guidance range of 24,500 – 25,500 Boe/d as expected, despite over 825 Boe/d of various planned and unplanned third party restrictions encountered throughout the year and selling 3,200 Boe/d of production associated with the W6 Sweet Cretaceous asset divestiture in June of 2016. These shortfalls were mostly offset by stronger than forecast well performance throughout the year and accelerated capital after the aforementioned asset sale; and
- In December, field estimated production exceeded 26,000 Boe/d which underpins a strong base entering 2017.
- We are pleased to provide five new well IP30’s in the table below. We continue to be very encouraged by ongoing results.
|New Well IP30 Results(1)|
|Well||Raw Gas||Condensate||Total Sales||CGR
|(1)||Based on field-estimated production data|
|(2)||Typecurves are based on NuVista’s internal best estimates|
- Well costs are on track as we continue to find efficiencies and drill faster. NuVista’s 2016 capital program cost estimate is expected to be at or below the bottom of the full year guidance range of $200 – $215 million.
- The Company is entering 2017 with a very healthy balance sheet. NuVista’s revolving credit facility was reconfirmed in November 2016 at $200MM, underpinned by continued strong well results and a growing proved producing reserve base. We entered 2017 completely undrawn on this facility; and
- We have continued to prudently add to our hedge positions for 2017 and 2018. We currently possess hedges which in aggregate cover 59% of 2017 projected liquids production at an average floor price of C$65.18/Bbl and 55% of 2017 projected gas production at an average price of C$3.26/Mcf. Both of these percentage figures relate to production net of royalty volumes.
2017 Outlook and Guidance Reaffirmed
Guidance for 2017 remains as previously announced with capital spending anticipated in the range of $260 – $300 million and production expected in the range of 28,000 – 31,000 Boe/d despite the planned 5 year cycle maintenance outages at the Simonette and K3 gas plants in 2017 causing a total negative annualized impact of approximately 3,000 Boe/d, primarily in the second and third quarter. These outages have planned durations of four and five weeks respectively, and existing crossover pipelines will be utilized during each outage to minimize the downtime impact by redirecting some production to other facilities. Due to some uncertainty on quarterly phasing of the outages, our guidance is 26,000 – 29,000 Boe/d for each of the first three quarters of 2017. The fourth quarter of 2017 is targeted to average 32,500 – 35,000 Boe/d after the 2017 plant maintenance work is complete, an increase of approximately 40% from fourth quarter 2016. We will update phasing for the first three quarters of 2017 as outage dates and durations become final.
November was unusually warm and wet in the Wapiti and Grande Prairie area. This caused poor road and lease conditions, preventing the moving of drilling rigs and heavy equipment. As a result of commencing our winter activity ramp-up approximately one month late, we had to modify our plans to temporarily add one extra rig in order to finish our winter drilling program prior to the spring breakup season. As a result, NuVista is presently drilling with five rigs and our schedule is back on track. We expect to bring approximately five new development wells on production in Wapiti during the first quarter of 2017 as per our original expectations. We anticipate drilling approximately 12-15 wells during the first quarter of 2017.
NuVista has top quality assets and a management team focused upon relentless improvement. We are excited to continue pursuing our 5 year growth plan to 60,000 Boe/d. We would like to thank our staff, contractors, and suppliers for their continued dedication and delivery, and we thank our board of directors and our shareholders for their continued guidance and support. Please note that our corporate presentation is being updated and will be available at www.nuvistaenergy.com on January 17, 2017.