Parallel Energy Trust

Parallel Energy Trust

August 21, 2012 16:00 ET

Parallel Energy Trust Announces Resumption of Production in Carson Field and Signing of Back-Up Processing Contract

CALGARY, ALBERTA--(Marketwire - Aug. 21, 2012) -


Parallel Energy Trust ("Parallel" or the "Trust") (TSX:PLT.UN) is pleased to announce that the plant that processes production from Parallel's Carson field will be able to flare residue gas by providing Notice of Force Majeure to the appropriate regulatory agency as required under Texas state air quality regulations. This will allow Parallel to return to full production in the field. As announced on August 13, 2012, Parallel's production at the Carson field was reduced by approximately 3,000 boe/day as a result of a curtailment of all gas plants that produce into certain segments of the third party owned and operated pipeline through which the gas from the Carson field is flowed, while regulatory testing of the pipeline was completed.

The flaring of gas at the processing plant permits the field to resume full production of condensate and natural gas liquids for the 2/3 of the field's production capacity that was previously curtailed. Approximately 2,000 boe/day of condensate and natural gas liquids have been brought back on to production, which represents gross revenue of US$100,000 per day based on average commodity prices in the second quarter of 2012. As approximately 1,000 boe/day of natural gas will be flared and therefore will not be sold, sales for Parallel should be in the 6,000 boe/day range until the curtailment is lifted, which is expected to be in mid to late September. Based on average realized natural gas prices in the second quarter of 2012, gross revenue lost due to flaring is US$13,000 per day.

In addition, Parallel has signed a back-up gas processing contract with a third party processing plant that will permit production from the Carson field to be redirected and processed in the event that the existing plant is unavailable. The contract is an interruptible contract and no minimum volumes are required. Parallel will be installing additional pipeline to connect to the plant at an estimated cost of $1.2 million and the connection is expected to be completed by the end of September.

"We are very pleased that we have been able to obtain approval to flare gas and resume full production from our Carson field, several weeks earlier than expected." said Dennis Feuchuk, CEO of the Trust. "The signing of the back-up processing contract is a very important step in improving the reliability of our production and demonstrates our ability to find solutions to problems that we have encountered. The back-up processing plant also provides another potential solution to the pipeline restriction in the Carson field should it last beyond the expected period of mid to late September."


Parallel's objectives are to create stable, consistent returns for investors through the acquisition and development of conventional oil and natural gas reserves and production with unexploited low risk potential in certain regions of the United States, and to pay out a portion of available cash to holders of trust units on a monthly basis. The trust units of Parallel are listed on the Toronto Stock Exchange under the symbol "PLT.UN" and the debentures are listed on the TSX under the symbol "PLT.DB".

Parallel is a "mutual fund trust" under the Income Tax Act (Canada) (the "Tax Act"). The Trust will not be a "SIFT trust" (as defined in the Tax Act), provided that the Trust complies at all times with its investment restriction which precludes the Trust from holding any "non-portfolio property" (as defined in the Tax Act). Further information relating to Parallel is set out in Parallel's annual information form dated March 21, 2012, which may be obtained on the SEDAR website at under Parallel's profile.


Forward-Looking Information

This news release contains forward-looking information that involves substantial known and unknown risks and uncertainties, most of which are beyond the control of Parallel, including, without limitation, those listed under "Risk Factors" in Parallel's annual information form dated March 21, 2012 (collectively, "forward-looking information"). Forward-looking information in this news release includes, but is not limited to, Parallel's objectives and status as a mutual fund trust and not a SIFT trust, Parallel's expectations and estimates regarding production levels from the Carson field, current and future production rates, timing of the removal of curtailment of production in the Carson field, production levels and gross revenue to be recovered from resumption of production in the Carson field and the timing and cost for completion of the pipeline. Parallel cautions investors in Parallel's securities about important factors that could cause Parallel's actual results to differ materially from those projected in any forward-looking statements included in this news release. Any statements that express, or involve discussions as to, expectations, beliefs, plans, objectives, assumptions or future events or performance are not historical facts and may be forward-looking and may involve estimates, assumptions and uncertainties which could cause actual results or outcomes to differ materially from those expressed in such forward-looking statements. No assurance can be given that the expectations set out in Parallel's final prospectus or herein will prove to be correct and accordingly, prospective investors should not place undue reliance on these forward-looking statements. These statements speak only as of the date of this press release and Parallel does not assume any obligation to update or revise them to reflect new events or circumstances.

In this news release, Parallel and its subsidiaries are referred to collectively as the "Trust" or "Parallel" for purposes of convenience.

Oil and Gas Measures and Definitions

This press release contains disclosure expressed as "boe" and "boe/day". All oil and natural gas equivalency volumes have been derived using the ratio of six thousand cubic feet of natural gas to one barrel of oil. Equivalency measures may be misleading, particularly if used in isolation. A conversion ratio of six thousand cubic feet of natural gas to one barrel of oil is based on an energy equivalency conversion method primarily.

Contact Information

  • Parallel Energy Trust
    Dennis Feuchuk
    President and CEO
    403-781-7888 or Toll Free: 1-855-781-7888

    Parallel Energy Trust
    Rick Miller
    Chief Financial Officer
    403-781-7888 or Toll Free: 1-855-781-7888