CALGARY, Alberta – Petrus Resources Ltd. (“Petrus” or the “Company“) (TSX: PRQ) is pleased to announce its Board of Directors has approved a 2022 capital budget of $50 to $55 million, which is expected to deliver average annual production in the range of 7,000 to 7,500 boe per day, a forecasted increase of approximately 25% compared to 2021 estimates. The majority of the forecasted production growth is expected to be realized in the second half of 2022 leading to estimated exit rates exceeding the forecasted annual average. Capital spending will be focused on drilling the highest rates of return, lowest risk locations in the Company’s core area of Ferrier, Alberta where Petrus’ operated gas plant has sufficient processing capacity to accommodate these volumes and projected production adds are expected to significantly reduce per unit operating expense. Petrus’ 2022 capital plan is designed to invest systematically within funds flow.
2022 BUDGET DETAILS
Capital will be largely focused on the drilling, completion and tie-in of 14 gross locations in Ferrier with a minimal amount of funds being directed toward necessary maintenance capital. The 2022 budget was contemplated using a price forecast of WTI at US$69.00/bbl, AECO gas price at $3.20/GJ and a foreign exchange rate of US$0.79. Under these pricing assumptions, through the execution of this capital plan, Petrus is expecting to:
- Achieve a 2022 exit production rate of 8,500 to 9,000 boe per day (62% conventional natural gas, 25% light crude oil and 14% natural gas liquids), a projected increase of 40-50% compared to 2021 average annual production.
- Generate $55-$60 million in annual funds flow, an anticipated 70-90% improvement compared to estimated 2021 results.
- Continue to reduce debt and further strengthen the Company’s balance sheet
Given the inherent volatility of commodity prices, the Company recognizes it is prudent to remain disciplined and flexible from an operational and financial perspective. Petrus will continue to monitor the price of Canadian light oil and natural gas and will evaluate capital investments on an ongoing basis.