CALGARY, ALBERTA--(Marketwired - Feb. 14, 2014) - Petroforte International Ltd. ("Petroforte" or the "Corporation") (TSX VENTURE:PFI) is pleased to provide the following updates on operations and other matters.
In January of 2014, two wells were drilled at the Corporation's Flood property, where the Corporation holds a 100% working interest.
The 1-7-85-24W5 well was drilled as a water disposal well. The 1-7 well drilling costs of approximately $475,000 were below budget expectations. Completion of the well is currently underway and an application for the well to be approved as a water disposal well will be submitted to the Alberta Energy Regulator (the "AER").
A vertical potential Montney oilwell was drilled at 5-8-85-24W5. The 5-8 well drilling costs of $500,000 were below budget expectations.
If the AER approves the application for the 1-7 well to be used as a water disposal well, the 5-8 well will be placed on production and three other currently shut-in Montney oilwells on the Flood property will be reactivated.
The existing battery is being upgraded to include an injection pump and recycle pump for the water disposal system. The existing and related tank farm is also being modified to treat the oil/water emulsion and dispose of excess water.
The Corporation expects to drill two more vertical Montney oilwells by the end of Q2, 2014 at the Flood property.
Brazeau River, Alberta
The Cardium Formation in the 2-5-48-14W5 well at the Corporation's Brazeau River property, where the Corporation holds a 100% working interest, was perforated and fracture stimulated in January of 2014. The well commenced oil production on February 5, 2014. Initial field production rates averaged 75 BOE per day during its first four production days. Given the limited production to date at the 2-5 well, the initial four day average production rate is not necessarily indicative of long-term performance or ultimate recovery.
The 2-5 well is the second successful Cardium recompletion well the Corporation has at Brazeau River.
The Brazeau River 9-5 well, which was placed on production on October 19, 2013, is currently producing at an average of approximately 170 BOE per day over the last 30 production days.
Petroforte acquired a 100% working interest in the SE quarter of Section 13-48-16W5 for Belly River oil potential on December 18, 2013 from the Alberta Government's land sale process for $78,000. The rights acquired are from surface to base Cardium.
Drilling commenced on a farm-in well at 9-21-67-8W6 on January 29, 2014. Rimfire Energy Inc. granted Petroforte a one month extension to spud the well due to rig availability issues.
The 9-21 well has reached the beginning of the horizontal leg in the Cardium Formation and casing has been set.
The 1,400 meters horizontal section of the well is being drilled and on February 12, 2014 the well penetrated a minimum of 400 meters. Pursuant to the farm-in agreement with Rimfire, the effect of this event is that Petroforte has earned a 70% working interest in the well and a 70% working interest in the northern half of Section 21 (where two other potential Cardium wells may be drilled) and an additional one and a quarter section of undeveloped land in the Wapiti area.
Effect on Reserves
The Corporation has not received sufficient information to allow it reach a conclusion regarding the effect of these developments on its reserves. It will report on reserve additions as part of its annual reserves disclosure later this year.
During the month of December 2013, the Corporation realized average daily sales volumes of approximately 430 BOE per day, comprised of 60% natural gas and 40% oil and natural gas liquids.
Private Placement Update
On January 14, 2014 Petroforte closed the second tranche of its private placement offering previously announced on December 12, 2013 and issued 1,875,000 equity units for gross consideration of $375,000, each unit consisting of one common share of the Corporation and one half of a common share purchase warrant. Each whole warrant entitles the holder to purchase one common share for $0.40 per share for a period commencing on the date of issuance and ending on March 31, 2016.
The Corporation wishes to clarify that on December 23, 2013 it issued 16,000,000 units for gross consideration of $3,200,000 rather than 17,875,000 units for gross consideration of $3,575,000 as indicated in its press release dated December 30, 2013. Together with the first tranche, the Corporation has issued a total of 17,875,000 units under the offering announced in December for gross consideration of $3,575,000.
Closing of the offering has received conditional approval by the TSXV and is still subject to final approval by the TSXV. All securities issued in connection with the Offering are subject to a four-month hold period.
Harry Knutson resigned as a director and officer of the Corporation on February 13, 2014. Effective immediately he will join the Corporation as Manager, Business Development and will take responsibility for developing and implementing acquisition transactions that will contribute to the Corporation's ongoing growth.
Petroforte is a junior oil and gas company headquartered in Calgary, Alberta engaged in the exploration, development and production of hydrocarbons in Alberta.
Forward Looking Statements
Certain information in this press release constitutes forward-looking statements under applicable securities law. Any statements that are contained in this press release that are not statements of historical fact may be deemed to be forward-looking statements. Forward-looking statements are often identified by terms such as "may", "should", "anticipate", "expects", "estimates", "seeks" and similar expressions.
Forward-looking statements necessarily involve known and unknown risks, including, without limitation, risks associated with oil and gas exploration, development, exploitation, production, marketing and transportation, loss of markets, volatility of commodity prices, currency fluctuations, imprecision of reserve estimates, environmental risks, competition from other producers, inability to retain drilling rigs and other services, failure to realize the anticipated benefits of acquisitions, delays resulting from or inability to obtain required regulatory approvals, changes in legislation including but not limited to income tax, environmental laws and regulatory matters, and ability to access sufficient capital from internal and external sources. Readers are cautioned that the foregoing list of factors is not exhaustive.
Readers are cautioned not to place undue reliance on forward-looking statements as there can be no assurance that the plans, intentions or expectations upon which they are placed will occur. Such information, although considered reasonable by management at the time of preparation, may prove to be incorrect and actual results may differ materially from those anticipated. Forward-looking statements contained in this press release are expressly qualified by this cautionary statement.
Additional information on these and other factors that could affect Petroforte's operations or financial results are included in Petroforte's reports on file with Canadian securities regulatory authorities and may be accessed through the SEDAR website (www.sedar.com.) or by contacting Petroforte.
The forward looking statements contained in this news release are made as of the date of this news release, and Petroforte does not undertake any obligation to update publicly or to revise any of the included forward-looking statements, whether as a result of new information, future events or otherwise, except as expressly required by securities law.
Barrel of oil equivalents (BOE) may be misleading, particularly if used in isolation. A BOE conversion ratio of 6 Mcf:1 bbl is based on an energy equivalent conversion method primarily applicable at the burner tip and does not represent a value equivalent at the wellhead.
Neither the TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.