/NOT FOR DISTRIBUTION IN THE UNITED
STATES NEWSWIRE SERVICES OR FOR DISSEMINATION IN
THE UNITED STATES/
CALGARY, Dec. 18, 2013 /CNW/ - Palliser Oil & Gas
Corporation ("Palliser" or the "Company") (TSX
VENTURE: PXL) would like to provide an operations update.
Fourth quarter 2013 average production is
anticipated to be approximately 2,000 boe per day, down 14% from
volumes reported in the prior quarter. For 2013, average production
is now forecasted at approximately 2,330 boe per day, representing
a 4% downward revision from the previous forecast.
Palliser previously provided operational updates
which noted that water breakthrough has been experienced in a
number of CHOPS wells in the Manitou area and that production declines have
outpaced additions from the capital spending program. The new
Manitou salt water disposal
facility was commissioned in late November, with high volume lift
ramp up of these wells commencing in December. It is forecasted
that the recovery of oil production from the affected wells at
Manitou will be realized through
the first quarter of 2014. In the Edam area, the Company has experienced higher
water cuts in a select number of high oil rate producers which have
recovered a significant percentage of the original oil in place,
resulting in production losses of approximately 200 barrels per day
as compared to the third quarter of 2013. The Company has reacted
to this development by expanding its salt water disposal take away
capacity and producing those specific wells at higher total fluid
rates. More recently, the Company re-completed new uphole zones in
two wells. These recent operations are forecasted to result in
production recoveries through the first quarter of 2014.
Due to these lower production volumes, operating
costs for the fourth quarter are forecasted to be higher on a per
unit basis. When combined with the realized wider heavy oil
differentials, the Company is now forecasting funds flow from
operating activities of approximately $2
million for the fourth quarter of 2013. Capital expenditures
for the fourth quarter are estimated to be $6 million, resulting in forecast year-end net
debt of approximately $46
million.
The fourth quarter capital program is now
complete; however, winter weather caused some delays in bringing
the remaining 2013 projects on production. Results from the
Company's total 2013 capital program appear to be in line with
previous years, with 18 wells being drilled, reactivated and
re-entered for production with 100% success. Production from these
projects is forecasted to contribute to corporate production growth
during the first quarter of 2014.
The Company anticipates providing an operations
update in conjunction with releasing its 2014 capital budget on or
before January 31, 2014.
For further information regarding Palliser Oil
& Gas Corporation, the reader is invited to visit the Company's
website at www.palliserogc.com.
Palliser is a Calgary-based emerging junior oil and gas
company currently focused on high netback heavy oil production in
the greater Lloydminster area of
both Alberta and Saskatchewan.
Forward-Looking Statements
Certain statements contained herein constitute forward-looking
statements or information (collectively "forward-looking
statements") within the meaning of applicable securities
legislation, including, but not limited to management's assessment
of future plans and operations, including: commodity focus;
drilling plans and potential locations; expected production levels;
expected transportation methods; development and acquisition plans;
certain economic factors; and capital expenditures.
With respect to forward-looking statements herein, Palliser has
made assumptions regarding, among other things; future capital
expenditure levels; future oil and natural gas prices;
"differentials" between West Texas Intermediate and Western
Canadian Select benchmark pricing; future oil and natural gas
production levels; future water disposal capacity; future exchange
rates and interest rates; ability to obtain equipment and services
in a timely manner to carry out development activities; ability to
market oil and natural gas successfully to current and new
customers; the ability to ship volumes by rail; the impact of
increasing competition; the ability to obtain financing on
acceptable terms; and the ability to add production and reserves
through development and exploitation activities. Although Palliser
believes that the expectations reflected in the forward-looking
statements contained herein, and the assumptions on which such
forward-looking statements are made, are reasonable, there can be
no assurance that such expectations will prove to be correct.
Readers are cautioned not to place undue reliance on
forward-looking statements included herein, as there can be no
assurance that the plans, intentions or expectations upon which the
forward-looking statements are based will occur. By their nature,
forward-looking statements involve numerous risks and uncertainties
that contribute to the possibility that the forward-looking
statements will not occur, which may cause Palliser's actual
performance and financial results in future periods to differ
materially from any estimates or projections. Additional
information on these and other factors that could affect Palliser's
results are included in reports on file with Canadian securities
regulatory authorities, including the Company's Annual Information
Form, and may be accessed through the SEDAR website at
www.sedar.com.
The forward-looking statements contained
herein speak only as of the date hereof. Except as expressly
required by applicable securities laws, Palliser does not undertake
any obligation to, nor does it intend to, publicly update or revise
any forward-looking statements, whether as a result of new
information, future events or otherwise. The forward-looking
statements contained herein are expressly qualified by this
cautionary statement. In addition, readers are cautioned that
historical results are not necessarily indicative of future
performance.
Production volumes are commonly expressed on
a barrel of equivalent ("BOE") basis whereby natural gas volumes
are converted at a ratio of six thousand cubic feet to one barrel
of oil. The intention is to convert oil and natural gas
measurement units into one basis for improved analysis of results
and comparisons with other industry participants. The term BOE may
be misleading, particularly if used in isolation. The
conversion ratio is based on an energy equivalent method and does
not represent an economic value equivalency at the
wellhead.
Neither the TSX Venture Exchange nor its
Regulation Services Provider (as that term is defined in the
policies of the TSX Venture Exchange) accepts responsibility for
the adequacy or accuracy of this Press release.
SOURCE Palliser Oil & Gas Corporation