PetroBakken Energy Ltd.
TSX : PBN

PetroBakken Energy Ltd.

December 07, 2009 00:23 ET

PetroBakken Energy Ltd: Corporate Update and 2010 Capital Plans

CALGARY, ALBERTA--(Marketwire - Dec. 7, 2009) - PetroBakken Energy Ltd. ("PetroBakken" or the "Company") (TSX:PBN) is pleased to provide an update on 2009 activities and guidance regarding plans for 2010. PetroBakken forecasts that in 2010 we expect to increase production by more than 15% while maintaining our current annualized dividend of $0.96 per share (paid monthly). PetroBakken will remain in the unique position of providing solid growth while generating an attractive dividend yield for our shareholders. Our high netback, light oil properties, with a large inventory of low-risk development locations, predominantly located in Southeast Saskatchewan, provide the cash flow to fund this model.

PetroBakken's current production is 36,500 boepd (exclusive of production from our Alberta assets), and we are well on our way to meet our 2009 exit production guidance of 37,000 boepd. PetroBakken currently has 13 drilling rigs operating in Southeast Saskatchewan, 11 rigs are drilling Bakken development wells while the other 2 rigs are drilling conventional oil plays. This drilling pace results in new producing wells being added at a rate of approximately 4 to 5 per wells per week.

Production guidance is being provided net of PetroBakken's Alberta volumes, as those assets are currently candidates for divestment, as previously announced. Offers to purchase our Alberta producing assets have been received from a number of interested parties during the past two weeks, and we are working towards final agreements and closing transactions on approximately two thirds of the assets that are for sale. We expect the first of these sales to close prior to December 31, 2009 with the remainder to be completed early in the first quarter of 2010. With respect to the remaining third of our Alberta production, discussions are ongoing. Following the anticipated sales, debt will be less than one times anticipated 2010 cash flow, providing excellent financial flexibility to fund our ongoing capital program and to pursue additional opportunities.

Our investment plans for 2010 are expected to result in an exit rate of over 42,500 boepd. To achieve this goal, the majority of our 2010 program will be focused on drilling 141 (128 net) wells in the Bakken resource play in addition to a further 121 (88 net) wells in our conventional light oil plays in Southeast Saskatchewan and Manitoba. The majority of the wells drilled for Bakken potential will be 1,400 metre long bilateral wells with a total of 30 to 40 staged fracture stimulations per well. This represents our latest Bakken technological plan and early results from this approach are encouraging, with relatively flat initial production averaging between 200 and 250 bbl/day, with anticipated declines which have yet to be clearly observed.

A portion of our 2010 capital program will focus on exploratory drilling for other resource play areas that include new Bakken and Torquay opportunities. It is also our intention to continue to drill in the Montney and Horn River plays of Northeast British Columbia to prove our geological concepts and to refine our technological approach to these large resource plays as we position for significant longer-term growth in these areas.

PetroBakken Energy Ltd. is a premier light oil production company combining, high growth, long-life Bakken reserves and production with legacy conventional light oil assets, delivering industry leading operating netbacks, strong cash flows and production growth. PetroBakken has a multi-year inventory of Bakken and light oil development locations, along with significant future development opportunities in the Horn River and Montney gas resource plays in northeast BC. Our strategy is to deliver accretive production and reserves growth, along with an attractive dividend yield.

Forward-Looking Statements. Certain information provided in this press release constitutes forward-looking statements. The words "anticipate", "expect", "project", "estimate", "forecast" and similar expressions are intended to identify such forward-looking statements. Specifically, this press release contains forward-looking statements relating to operations, capital plans and expected results from operations. The reader is cautioned that assumptions used in the preparation of such information, although considered reasonable at the time of preparation, may prove to be incorrect. Actual results achieved during the forecast period will vary from the information provided herein as a result of numerous known and unknown risks and uncertainties and other factors. You can find a discussion of those risks and uncertainties in our Canadian securities filings. Such factors include, but are not limited to: general economic, market and business conditions; fluctuations in oil prices; the results of exploration and development drilling, recompletions and related activities; timing and rig availability, outcome of exploration contract negotiations; fluctuation in foreign currency exchange rates; the uncertainty of reserve estimates; changes in environmental and other regulations; risks associated with oil and gas operations; and other factors, many of which are beyond the control of the Company. There is no representation by PetroBakken that actual results achieved during the forecast period will be the same in whole or in part as those forecast. Except as may be required by applicable securities laws, PetroBakken assumes no obligation to publicly update or revise any forward-looking statements made herein or otherwise, whether as a result of new information, future events or otherwise.

Contact Information

  • PetroBakken Energy Ltd.
    John D. Wright
    Chairman of the Board and Chief Executive Officer
    (403) 750-4400
    or
    PetroBakken Energy Ltd.
    R. Gregg Smith
    President and Chief Operating Officer
    (403) 750-4400
    or
    PetroBakken Energy Ltd.
    Corey C. Ruttan
    Executive Vice President, Chief Financial Officer
    and Director
    (403) 750-4400
    or
    PetroBakken Energy Ltd.
    Bill Kanters, Vice President Business Development
    and Corporate Planning
    (403) 750-4400
    ir@petrobakken.com
    www.petrobakken.com