CALGARY, Alberta, Oct. 24, 2017 (GLOBE NEWSWIRE) — RMP Energy Inc. (the “Company”) (TSX:RMP) is pleased to provide an operations update and announce its capital budget plans for this upcoming winter drilling season. The Company is changing its corporate name to “Iron Bridge Resources Inc.“. The name change is expected to become effective on or before November 17, 2017. The ticker symbol “IBR” has been reserved by the Toronto Stock Exchange for the Company’s use following the name change becoming effective.
Elmworth Drilling and Operations Update
The Company is pleased to announce that its Elmworth 15-23 Montney oil well achieved IP30 production of approximately 900 boe/d, which was constrained by gas compression for much of its initial first month of production. With those restrictions now eliminated, the 15-23 well is currently flowing at 1,180 boe/d (based on field estimates, consisting of 270 bbls/d of light sweet oil, 4.4 MMcf/d of natural gas sales, and 180 bbls/d of NGLs). This well has a significantly shorter lateral section than our other wells or our future planned wells. Normalizing for length and frac stages, this well is representative of the excellent economics that are being displayed in the Montney light oil window at Elmworth.
In the third quarter, the Company drilled and completed its fourth, 100% working interest Elmworth Montney horizontal well (15-23-68-3W6). Due to land restrictions, the lateral section of this horizontal well was drilled to 1,462 meters, which is approximately 750 meters shorter than the two previous wells at Elmworth and 1,000 meters shorter than our anticipated future drills. The Company changed the completion design on the 15-23 well relative to its first three wells at Elmworth. Fracture stimulation intensity was increased by reducing the distance between stages to 50 meters and increasing the amount of sand per stage to 60 tonnes, meanwhile pump rate was reduced. A total of 30 stages were completed with slickwater and the well was tied into the 2-23 Facility on September 13, 2017. During the first thirty producing days (“IP30”) the 15-23 well was mechanically choked-back due to the aforementioned gas compression capacity limitations. Notwithstanding this operational curtailment and a shorter lateral length, the 15-23 well produced on average an IP30 of approximately 900 boe/d, consisting of 210 bbls/d of light sweet oil, 3.6 MMcf/d of natural gas sales, and 90 bbls/d of NGLs. With additional compression now in-operation at the 2-23 Facility, the 15-23 well is currently producing above its IP30 rate, at approximately 1,180 boe/d.
For the third quarter of 2017, the Company’s average daily production was approximately 4,000 boe/d, with light crude oil and NGLs volumes accounting for 31% of the third quarter production. The Company’s reported third quarter production level includes production contribution from the Waskahigan/Grizzly, Kabob, Gilby and Pine Creek areas of West Central Alberta, in addition to other minor Alberta properties, which were collectively sold on October 17, 2017, pursuant to the previously-announced strategic asset disposition (the “Transaction”).
The Company’s core Elmworth Montney property produced 1,410 boe/d on average for the third quarter, with a light oil and NGLs weighting of approximately 30%. Only two of the Company’s Elmworth drilled-wells produced concurrently during the third quarter due to gas compression restrictions at its 2-23 Facility. In early-October 2017, however, additional compression was installed and as a result the Elmworth 2-23 Facility is presently handling the crude oil, emulsion and natural gas production from all three (3.0 net) of the Company’s Montney horizontal wells (3-22, 4-18 and 15-23) drilled at the same surface lease pad as the 2-23 Facility.
The Company’s 2-23 Facility now has capacity to handle 1,500 bbls/d of crude oil, approximately 16 MMcf/d of natural gas and 7,500 bbls/d of emulsion The Company’s current production at Elmworth is approximately 2,200 boe/d, weighted 35% light crude oil and NGLs (based on field estimates).
Winter Drilling Capital Budget
The Company’s Board of Directors has approved a capital expenditures program of approximately $25 million, to be invested at its Elmworth asset base for this upcoming winter drilling season (present through to April 30, 2018).
The Company plans to drill a total of five (5.0 net) wells this winter season with two of the wells to be completed and tied into the 2-23 Facility prior to spring break-up and two to be drilled but not completed until later in 2018. The fifth well is a water injection well that is expected to spud in early-November. The two drilled and uncompleted wells will continue 41 sections of prospective acreage past its primary expiry date through to the year 2020. The two upcoming wells at the Company’s 2-23 Facility pad site will be drilled with approximately 2,400 meters of lateral length and will be completed with approximately 80 slickwater stages in January 2018. Drill, complete and tie-in costs for these two wells is estimated to be approximately $5.7 million per well.
With the closing of the previously announced Transaction, the Company has significant financial flexibility and full funding capability to carry out its winter drilling capital budget. The Company estimates that exiting this year-end of 2017, it will have approximately $33 million of liquidity (positive working capital plus investments) and no bank debt outstanding. The Company will remain flexible as it monitors results and commodity prices over the coming months and, may adjust its planned winter capital expenditures. The Company has flexibility to adjust the level of its capital investments as circumstances warrant.
In addition to the Company’s operated delineation and development plans at Elmworth, Montney drilling and completion activities are being undertaken in close proximity to the Company’s acreage by other operators, which is expected to provide valuable geologic information and assist in de-risking this highly-prospective fairway.
At Elmworth, the Company holds a large undeveloped land base consisting of 84 (83.5 net) sections (53,440 net acres) of operated acreage, with substantial resource potential. Future asset development of the Montney will be focused on extended reach horizontals with increased frac and proppant intensity. These technical improvements coupled with operational efficiencies in spud-to-on-stream cycle times, emulsion management and infrastructure optimization will provide the key to unlocking the vast potential of the Elmworth Montney fairway.
For more information, please contact:
RMP ENERGY INC.
Chief Executive Officer
Vice President, Finance and Chief Financial Officer
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