CALGARY, Alberta, Sept. 19, 2022 (GLOBE NEWSWIRE) — Petrus Resources Ltd. (“Petrus” or the “Company“) (TSX: PRQ) is pleased to announce the acceleration and expansion of its capital program, resulting in increased 2022 budget guidance and an updated operational outlook.
UPDATED 2022 BUDGET GUIDANCE
Market conditions have improved materially since the release of Petrus’ initial 2022 budget in December of last year. During the first six months of 2022, due to a combination of increased production and stronger commodity prices, the Company generated significantly higher funds flow from operations than originally budgeted. Given the increased funds flow to date and the forecast for the remainder of the year, the Board of Directors has approved a revised 2022 capital budget of $105 million to $115 million (up from $50-$55 million), of which $90 to $100 million is cash to be directed toward the 2022 capital program with the balance having been directed toward a previously announced non-cash strategic acquisition that closed in March 2022. Capital spending and operational efforts will continue to be largely focused on further development of the Company’s core Ferrier area with approximately $80 million to $90 million directed to drilling, completion and tie-ins; an increase of nearly 70%. The remaining $10 million is primarily budgeted for land, seismic, and facilities for which minimal capital had been allocated in the original 2022 budget.
The revised 2022 capital budget was developed using an average price forecast for September through December 2022 of US$73/bbl WTI for oil, an AECO gas price of CAD$3.80/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 10,500 to 11,000 boe1 per day, which is a projected increase of 73% to 81% compared to the 2021 exit rate of 6,084 boe per day.
- Generate $85 million to $90 million in annual funds flow2 for 2022, representing an anticipated 155% to 170% improvement compared to 2021 annual funds flow of $33.4 million.
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 Canadian light oil and natural gas prices and will evaluate capital investments on an ongoing basis.
Petrus’ 2022 capital program is well underway, with spending largely focused on drilling in our core Ferrier area. There are two rigs actively running; drilling operations have been finalized on the first two pads in the program and completion operations have commenced on both pads. The Company looks forward to providing updates on the results of the capital program as the year progresses.
Petrus is a public Canadian oil and gas company focused on property exploitation, strategic acquisitions and risk-managed exploration in Alberta.