Arsenal Energy Inc.

Arsenal Energy Inc.

June 18, 2012 17:40 ET

Arsenal Energy Inc. Updates North Dakota Completions and Princess, Alberta Upcoming Drilling

CALGARY, ALBERTA--(Marketwire - June 18, 2012) - Arsenal Energy Inc. (TSX:AEI) (PINKSHEETS:AEYIF)

At Stanley North Dakota, Arsenal as operator has completed and tested the Anthony Robert two mile horizontal Bakken well. The well flowed at 978 bbls/d of oil during a 24 hour test period and has been turned over to production. The offsetting Wade Morris horizontal Bakken well has been successfully fracture stimulated but plugged off with sand during flow back. A sand cleanout has been scheduled in approximately two weeks. After cleanout Arsenal anticipates the Wade Morris will have flow rates similar to the Anthony Robert. Arsenal has an approximate 84% working interest in each well.

At Princess in Eastern Alberta, Arsenal has contracted a drilling rig for two horizontal Glauconite wells. The first well is expected to be spud by July 15th. Arsenal has a 100% working interest in each well and has identified 16 possible follow up wells from 3D seismic.

To receive company news releases via e-mail, please advise and specify "Arsenal Press Releases" in the subject line.


All barrels of oil equivalent (boe) conversions in this report are deprived by converting natural gas to oil at the ratio of six thousand cubic feet (Mcf) of natural gas to one barrel (bbl) of oil. Certain financial values are presented on a boe basis and such measurements may not be consistent with those used by other companies. Boe amounts may be misleading, particularly if used in isolation. A boe conversion ratio has been calculated using a conversion rate of six thousand cubic feet of natural gas to one barrel of oil (6 Mcf: 1 bbl) and is based on an energy equivalency conversion method applicable at the burner tip and does not represent a value equivalency at the wellhead.

Certain financial measures referred to in this release, such as funds from operations and funds from operations per share, are not prescribed by generally accepted accounting principles (GAAP). Funds from operations is a key measure that demonstrates the ability to generate cash to fund expenditures. Funds from operations is calculated by taking the cash provided by operations from the consolidated statement of cash flows and adding back changes in non-cash working capital. Funds from operations per share is calculated using the same methodology for determining net income per share. These non-GAAP financial measures may not be comparable to similar measures presented by other companies. These financial measures are not intended to represent operating profits for the period nor should they be viewed as an alternative to cash provided by operating activities, net income or other measures of financial performance calculated in accordance with GAAP.

Management uses certain industry benchmarks such as field netback to analyze financial and operating performance. Field netback has been calculated by taking oil and gas revenue less royalties, operating costs and transportation costs. This benchmark does not have a standardized meaning prescribed by GAAP and may not be comparable to similar measures presented by other companies. Management considers field netback as an important measure to demonstrate profitability relative to commodity prices.

Certain statements and information contained in this press release, including but not limited to management's assessment of Arsenal's future plans and operations, production, reserves, revenue, commodity prices, operating and administrative expenditures, funds from operations, capital expenditure programs and debt levels contain forward-looking statements. All statements other than statements of historical fact may be forward looking statements. These statements, by their nature, are subject to numerous risks and uncertainties, some of which are beyond Arsenal's control including the effect of general economic conditions, industry conditions, changes in regulatory and taxation regimes, volatility of commodity prices, escalation of operating and capital costs, currency fluctuations, the availability of services, imprecision of reserve estimates, geological, technical, drilling an processing problems, environmental risks, weather, the lack of availability of qualified personnel or management, stock market volatility, the ability to access sufficient capital from internal and external sources and competition from other industry participants for, among other things, capital, services, acquisitions of reserves, undeveloped lands and skilled personnel that may cause actual results or events to differ materially from those anticipated in the forward looking statements. Such forward-looking statements although considered reasonable by management at the time of preparation, may prove to be incorrect and actual results may differ materially from those anticipated in the statements made and should not unduly be relied on. These statements speak only as of the date of this press release. Arsenal does not intend and does not assume any obligation to update these forward-looking statements, whether as a result of new information, future events or otherwise, except as required by applicable law. Arsenal's business is subject to various risks that are discussed in its filings on the System for Electronic Document Analysis and Retrieval (SEDAR).

Contact Information

  • Arsenal Energy Inc.
    Tony van Winkoop
    President and Chief Executive Officer
    (403) 262-4854
    (403)-265-6877 (FAX)

    Arsenal Energy Inc.
    J. Paul Lawrence
    Vice President, Finance and CFO
    (403) 262-4854
    (403)-265-6877 (FAX)

    Arsenal Energy Inc.
    1900, 639 - 5th Avenue S.W.
    Calgary, Alberta, T2P 0M9