CALGARY, ALBERTA--(Marketwired - Jan. 8, 2014) - Parallel Energy Trust (TSX:PLT.UN)(TSX:PLT.DB) ("Parallel" or the "Trust") today announced its estimated production results for the fourth quarter and full year 2013, the commencement of its 2014 drilling program and its estimated year-end debt.
During the fourth quarter of 2013, Parallel recorded average daily production of approximately 7,250 boe/day based on field data. This results in 2013 estimated average daily production of approximately 7,150 boe/day, an increase of over 20% compared to the Trust's average daily production in 2012. Parallel's estimated fourth quarter and annual production levels both exceeded the Trust's 2013 average daily production guidance of 7,000 boe/day. The Trust also achieved its recently increased 2013 exit rate production guidance of 7,300 boe/day.
The oil and gas industry in Texas was negatively impacted by severe winter weather during the months of November and December. Although these weather conditions had an adverse effect on the Trust's production during the quarter, Parallel's operating team responded quickly and was able to mitigate the impact, keeping average production levels within the Trust's contingency for downtime of three to five per cent.
Parallel has commenced its 2014 drilling program with the spud of its first well on January 6, 2014. The Trust is currently operating one drilling rig in the Carson operating area and plans to drill up to 14 wells during the year.
Parallel estimates that its bank debt was approximately US$154 million as of December 31, 2013. This results in US$36 million of availability on the Trust's bank facility of US$190 million and represents bank debt reduction of approximately US$4.2 million during the fourth quarter of 2013.
"For the second time in 2013 our operating team demonstrated our ability to effectively manage our assets during periods of extreme weather conditions," explains Rick Alexander, Parallel's President and CEO. "As a result, we realized strong average production levels in the fourth quarter and we achieved record annual production for 2013. We also continued to improve our financial flexibility by further reducing our outstanding bank debt. Moving ahead, we are happy to have commenced our 2014 drilling program and we look forward to providing updates on our drilling results."
ABOUT PARALLEL ENERGY TRUST
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 ("TSX") 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 25, 2013, which may be obtained on the SEDAR website at www.sedar.com under Parallel's profile.
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 25, 2013 (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 and Parallel's expectations and estimates regarding current and future production rates and drilling results. 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.