CALGARY, Alberta – Crew Energy Inc. (TSX: CR; OTCQB: CWEGF) (“Crew” or the “Company”) is a growth-oriented natural gas weighted producer operating exclusively in the world-class Montney play in northeast British Columbia. The Company is pleased to announce that we have established a new record production rate in Q1 2022, and strong condensate rates from our latest completion program, setting the stage to deliver greater than 20% production per share growth and an enhanced financial position.
- RECORD Q1/22 PRODUCTION
- Q1/22 estimated average production totaled 33,300 boe per day1 (200 mmcfe), based on field estimates, a Company record representing a 27% increase over Q1/21 average production of 26,257 boe per day1 (157 mmcfe) and a 14% increase sequentially over Q4/21 average production of 29,142 boe per day1 (175 mmcfe).
- Based on field estimates, Q1/22 natural gas production increased 33% to 159 mmcf per day, condensate production increased 45% to 3,900 bbls per day, natural gas liquids2 (“NGLs”) increased 19% to 2,800 bbls per day and crude oil production decreased by 25% to 115 bbls per day, compared to Q1/21.
- With a strong start to 2022, full year average production is anticipated to be in-line with previously announced guidance of 31,000 to 33,000 boe per day1, which at the midpoint, represents a 21% increase over 2021.
- At these production levels, Crew’s unit costs will continue to decline, expanding margins and generating higher Adjusted Funds Flow (“AFF”).
- STRONG CONDENSATE-RICH WELLS AT GREATER SEPTIMUS
- Eight (8.0 net) extended reach horizontal ultra-condensate rich wells on the 4-14 pad were brought on stream in late Q4/21 and Q1/22, and have been flowing for periods of between 11 to 66 days before being shut-in for tie-in to permanent facilities. Last full day single well production rates from the eight wells averaged a cumulative total of 11,285 boe per day, comprised of 30,523 mcf per day of natural gas, 5,717 bbls per day of condensate and 480 bbls per day of NGLs2.
- At Crew’s 4-21 pad, two (2.0 net) Upper Montney “B” zone wells have now produced for 90 days (“IP90”) with average per well sales rates of 1,486 boe per day, comprised of 6,070 mcf per day of natural gas, 307 bbls per day of condensate and 167 bbls per day of NGLs2.
- In Q1/22, Crew drilled five (5.0 net) additional wells that will evaluate two additional zones on the Groundbirch 4-17 pad, following the success of our first three wells in the area that were drilled and completed in 2021. The initial three (3.0 net) Groundbirch wells are exceeding our Proved plus Probable area type curve forecasts, as reflected in Crew’s year-end 2021 independent reserves evaluation, with an average per well raw gas production rate after 150 days (“IP150”) of 8,976 mcf per day.
- CAPITAL EXPENDITURES ON TRACK
- Net capital expenditures3 in Q1/22 are expected to be approximately $56 million, while full year net capital expenditure3 guidance remains at $80 to $95 million with five Groundbirch wells currently planned to be completed and tied-in the last half of the year. Crew’s focus in 2022 is to generate meaningful Free Adjusted Funds Flow (“FAFF”) to reduce debt and enhance corporate sustainability.
Our team is excited with the progress made on the Company’s Two-Year Plan. In 2022, we expect to improve leverage metrics by reducing debt and increasing AFF, driving enhanced financial flexibility. AFF is expected to be enhanced through increasing production and significantly reducing per unit costs from 2020 to 2022. Underpinning these efforts is Crew’s unwavering focus on meeting or exceeding our ESG goals and remaining a safe and responsible operator and a good corporate citizen. We look forward to reporting our Q1/22 financial results on May 5th, 2022.
1) See table in the Advisories for production breakdown by product type as detailed in NI 51-101.
2) Excludes condensate volumes which have been reported separately.
3) Non-IFRS financial measure that does not have any standardized meaning as prescribed by International Financial Reporting Standards, and therefore, may not be comparable with calculations of similar measures or ratios for other entities. See “Advisories – Non-IFRS and Other Financial Measures” contained within this press release.