CALGARY, AB – Paramount Resources Ltd. (“Paramount” or the “Company”) (TSX: POU) is pleased to report that fourth quarter 2020 sales volumes averaged approximately 73,000 Boe/d (42% liquids), ahead of guidance of 70,000 Boe/d to 72,000 Boe/d. December 2020 sales volumes averaged approximately 78,000 Boe/d (43% liquids).
At Karr, fourth quarter sales volumes benefitted from the addition of five new wells (three Upper Montney and two Middle Montney) at the 5-16 West pad, which were brought onstream through permanent facilities in November. Lease construction, drilling and completion costs for this pad averaged approximately $6.8 million per well, $0.4 million lower than prior estimates. All-in lease construction, drilling, completion, equip and tie-in (collectively, “DCET”) costs averaged approximately $7.6 million per well, below Paramount’s type well DCET assumption for Karr of $8.4 million. Sales volumes averaged approximately 27,000 Boe/d (56% liquids) at Karr during the fourth quarter of 2020 and approximately 28,750 Boe/d (57% liquids) in December. Excellent progress has been made on the most recent six-well (all Middle Montney) Karr 3-10 pad. Preliminary DCET costs are coming in below type well cost and first production is now anticipated in February 2021, two months ahead of schedule.
At Wapiti, fourth-quarter sales volumes benefitted from the addition of five new wells (two Middle Montney and three Lower Montney) at the 5-3 West pad, which were all brought onstream through permanent facilities by December. Lease construction, drilling and completion costs for this pad averaged approximately $7.2 million per well, $0.1 million lower than prior estimates. All-in DCET costs averaged approximately $7.6 million per well, below Paramount’s type well DCET assumption for Wapiti of $7.9 million per well. Sales volumes averaged approximately 10,750 Boe/d (64% liquids) at Wapiti during the fourth quarter of 2020 and approximately 13,500 Boe/d (62% liquids) in December.
Paramount has had a very active start to 2021 with three rigs running in the Grande Prairie region. Complete fourth quarter and year-end 2020 results will be provided before market open on March 3, 2021, including further details on the Company’s previously announced 2021 capital plans.
Paramount is also pleased to announce $80 million of non-core asset dispositions pursuant to three transactions, two of which have recently closed and with the third expected to close in February. The estimated impact to 2021 working interest production is approximately 2,600 Boe/d (95% natural gas). Combined, 2020 netbacks from these properties totaled approximately $10 million. The proceeds from the dispositions will be used to reduce amounts drawn on the Company’s $1 billion senior secured revolving credit facility. Pro forma the dispositions and the $35 million senior unsecured convertible debenture financing completed in January, credit facility drawings were approximately $700 million as at December 31, 2020.
Paramount is an independent, publicly-traded, liquids-focused Canadian energy company that explores for and develops both conventional and unconventional petroleum and natural gas reserves and resources, including longer-term strategic exploration and pre-development plays, and holds a portfolio of investments in other entities. The Company’s principal properties are located in Alberta and British Columbia. Paramount’s Class A common shares are listed on the Toronto Stock Exchange under the symbol “POU.”