10.08.2018 kl 08:16 14136
10/08-2018 08:10:00: (QEC) Questerre reports on Q2 2018 resultsPresidents Message Highlights - Average daily production of 2,016 boe/d for the quarter with adjusted funds flow from operations of $6.01 million - Government of Quebec introduces draft regulations intended to prohibit hydraulic fracturing of the Quebec Utica - Executes letter of intent to consolidate ownership of Quebec assets - Finalizes feasibility study for Jordan oil shale project The Quebec government's decision to attempt to ban hydraulic fracturing blindsided us. We recently filed a brief with the government strongly objecting to this decision. Specifically, we have made the case that the proposed regulations are neither well drafted nor legally within the power of the government. We have requested a meaningful consultation to resolve these material issues prior to finalizing the regulations. We suspect this announcement was made solely for the upcoming election because it directly conflicts with the extensive environmental studies on hydraulic fracturing conducted during the Strategic Environmental Assessment, the letter and intent of the hydrocarbon legislation enacted in December 2016 and the government's own published guidelines on social acceptability. Most importantly, it runs contrary to the recent polling data where 60% of Quebecers support local natural gas development. It overshadowed a strong quarter for Questerre. To regain operatorship of our acreage and advance the clean gas pilot, we signed an LOI with our partner to acquire their Quebec assets. Consideration will include a mutual release for outstanding litigation where our damages are independently assessed at between approximately $50 to $240 million. On closing, we will also put up cash and security for abandonment liabilities totalling approximately $16 million. We were also pleased with the results of the Hatch feasibility study on our Jordan oil shale project. Preliminary estimates of combined capital and operating costs for the first phase are approximately US$38-40/bbl. Costs include upgrading the produced oil to diesel and gasoline which realize a US$10-12/bbl premium to Brent. This makes it competitive with similar large-scale energy projects. We expect the next round of engineering will tighten the error bars on these estimates from +100/-50% to +30/-20%. We are also looking at ways to optimize these costs and overall recoveries to further improve the economics for this multi billion-barrel deposit. With higher oil and liquids prices, particularly condensate, the economics at Kakwa continue to get better. Like last year, we plan to participate in all wells on our producing acreage. Two (0.50 net) more wells will be on by year-end with up to another eight to nine gross wells beginning in the fourth quarter of this year. As a result, production will decline over the second half before growing in the new year. To accommodate these increased volumes, we are expanding infrastructure, namely our central processing facility and central water storage, this year. Our year to date investment at Kakwa, mainly on infrastructure, was $14.5 million. We anticipate spending an additional $10-12 million here during the second half of the year. We are looking forward to the results from the wells at Kakwa North. The second well should spud later in the third quarter and the operator intends to complete both wells this fall. With success, we could see a similar ramp up in drilling on this acreage next year. The increased investment in Kakwa last year saw us almost double production volumes to just over 2,000 boe/d this year. Including the higher oil production at Antler, our liquids weighting is about two thirds with an average realized liquids price of almost $72 per barrel. This was largely responsible for adjusted funds flow from operations of $10.7 million for the first half of this year up from $2.29 million last year. Despite the election politics in Quebec, we are still working to get our pilot project off the ground. Building on the strong local support, we recently announced plans for sharing revenue with municipalities. We are committed to working with the government and stakeholders but the process must be fair. We are also preparing our back up plan, including legal claims if we are unable to move forward. Michael Binnion President and Chief Executive Officer
Ekstern link: http://www.newsweb.no/index.jsp?messageId=456853
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Lokal tid i Norge: 10/08-2018 08:14:41. Ingen åpne markeder
Redigert 21.01.2021 kl 05:20
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