Renegade Petroleum Ltd.
TSX VENTURE : RPL

Renegade Petroleum Ltd.

August 11, 2011 07:00 ET

Renegade Petroleum Ltd. Provides Operational Update and Re-Affirms 2011 Guidance

CALGARY, ALBERTA--(Marketwire - Aug. 11, 2011) -

THIS NEWS RELEASE IS NOT FOR DISSEMINATION IN THE UNITED STATES OR TO ANY UNITED STATES NEWS SERVICES.

Renegade Petroleum Ltd. ("Renegade" or the "Company") (TSX VENTURE:RPL) is pleased to provide an update on its operating activities in Saskatchewan, Manitoba and North Dakota. Total estimated field production as at August 10, 2011 was approximately 3,000 boe/d (95% light oil). Management expects production to continue to increase throughout the quarter as the Company continues to bring on recently drilled wells from both the Viking play and Southeast Saskatchewan.

OPERATIONAL UPDATE

West Central Saskatchewan

Subsequent to the post break-up period (beginning May 17th in West Central Saskatchewan) the Company has drilled 35.0 gross (34.5 net) horizontal Viking light oil wells, of which 25.0 gross (24.5 net) have been fracture stimulated, and 18.0 gross (17.5 net) are on production. Of the 18 wells that are on production, 7 wells are "flowing" or producing up casing without the aid of artificial lift, and 11 wells are on production via pumpjack.

Production levels of the 18 new Viking horizontal wells have exceeded management's expectations with 4 of the 7 flowing wells currently producing in excess of 100 bbls/d of oil, all of which are being produced at a restricted or "choked back" rate.

Southeast Saskatchewan and Manitoba

An extended breakup period was anticipated and budgeted for by Renegade. Wet spring conditions in May and June hampered surface access in several of the Company's operating areas. Recently, conditions have been improving, and Renegade commenced drilling operations in early July. Renegade currently has one active drilling rig in Southeast Saskatchewan. The Company has drilled and completed 2.0 gross (1.5 net) wells in the Wordsworth area and a third is currently being drilled. The Company has also drilled and completed 1.0 gross (1.0 net) Viewfield area Bakken well which is currently on flow-back following fracture stimulation.

North Dakota

Renegade has recently concluded the initial production test on the A Trout 6H3-14 well located in Renville County North Dakota. The test has established light (43° API) Bakken oil production approximately 30 miles east of the nearest Bakken producer. This well confirms eastward migration from over pressured Bakken towards the depositional edge of the Middle Bakken sand and opens up a potential resource play along the eastern Williston Basin of North Dakota. The depths of the Bakken in Renville County are similar to the depths of the Bakken in the Viewfield pool in Southeast Saskatchewan. The initial 7 day test averaged 36 bbl/d from a 3,100 foot horizontal well. Renegade continues to evaluate, optimize and production test the well with further operational and optimization activities planned.

Renegade is very encouraged by the presence of producible oil in the middle Bakken sand and is currently moving forward with development plans to further de-risk the play. In concert with the development of this well, Renegade has increased its land position to over 47,350 gross (23,675 net) acres in the prospective area.

OUTLOOK AND GUIDANCE

Renegade has exposure to three proven light oil resource plays: the Bakken play in SE Saskatchewan, the Spearfish play in SW Manitoba, and the Viking play in West Central Saskatchewan. In addition Renegade has a potential emerging light oil resource play in Renville County, North Dakota. Renegade continues to be one of the highest percentage light oil producers in the Canadian Oil & Gas industry.

Since drilling commenced post break-up in 2011 Renegade has managed to accelerate its program in West Central Saskatchewan and as a result is ahead of schedule on its 2011 drilling program. Renegade is now fully operational in Southeast Saskatchewan and Manitoba. Renegade expects to drill an additional 7.0 gross (5.8 net) wells in Southeast Saskatchewan and Manitoba by the end of 2011.

In addition to the 17.0 gross (17.0 net) wells yet to be brought on production in West Central Saskatchewan, Renegade anticipates drilling an additional 7.0 gross (7.0 net) wells for the remainder of the year. Renegade expects to have all of its wells from the Viking play on production by the end of 2011.

Management is very encouraged with Renegade's recent success in Renville County in further defining a potential new light oil Bakken resource play. Renegade plans on drilling a follow-up location to its first Bakken well in the fourth quarter of 2011.

During the first half of 2011 Renegade has been actively increasing its land holdings in all of its light oil producing areas. Renegade's total undeveloped land position is 98,293 net undeveloped acres.

Due to its recent success in the Viking in West Central Saskatchewan and in Southeast Saskatchewan, the Company is reaffirming its previously stated guidance of averaging between 2,400 to 2,600 boe/d for the year ending 2011.

CORPORATE INFORMATION

Renegade's common shares trade on the TSX Venture Exchange under the symbol RPL. Renegade currently has approximately 77.3 million shares outstanding and 84.5 million fully-diluted shares.

FORWARD-LOOKING STATEMENTS

This press release contains forward-looking statements. More particularly, this press release contains statements concerning Renegade's capital expenditure program, Renegade's drilling plans and the expected ability of Renegade to execute on its exploration and development program.

The forward-looking statements contained in this document are based on certain key expectations and assumptions made by Renegade, including: (i) with respect to capital expenditures, generally, and at particular locations, the availability of adequate and secure sources of funding for Renegade's proposed capital expenditure program and the availability of appropriate opportunities to deploy capital; (ii) with respect to drilling plans, the availability of drilling rigs, expectations and assumptions concerning the success of future drilling and development activities and prevailing commodity prices; (iii) with respect to Renegade's ability to execute on its exploration and development program, the performance of Renegade's personnel, the availability of capital and prevailing commodity prices; and (iv) with respect to anticipated production, the ability to drill and operate wells on an economic basis, the performance of new and existing wells and accounting risks typically associated with oil and gas exploration and production.

Although Renegade believes that the expectations and assumptions on which the forward-looking statements are based are reasonable, reliance should not be placed on the forward-looking statements because Renegade can give no assurance that they will prove to be correct. Since forward-looking statements address future events and conditions, by their very nature they involve inherent risks and uncertainties. Actual results could differ materially from those currently anticipated due to a number of factors and risks. These include, but are not limited to, the failure to obtain necessary regulatory approvals, risks associated with the oil and gas industry in general (e.g., operational risks in development, exploration and production; delays or changes in plans with respect to exploration or development projects or capital expenditures; the uncertainty of reserve estimates; the uncertainty of estimates and projections relating to production, costs and expenses; health, safety and environmental risks; commodity price and exchange rate fluctuations; and uncertainties resulting from potential delays or changes in plans with respect to exploration or development projects or capital expenditures).

The forward-looking statements contained in this document are made as of the date hereof and Renegade undertakes no obligation to update publicly or revise any forward-looking statements or information, whether as a result of new information, future events or otherwise, unless so required by applicable securities laws.

Any references in this news release to initial and/or final raw test or production rates and/or "flush" production rates or 7 day test production rates are useful in confirming the presence of hydrocarbons, however, such rates are not determinative of the rates at which such wells will continue production and decline thereafter. Additionally, such rates may also included recovered "load oil" fluids used in well completion stimulation. While encouraging, readers are cautioned not to place reliance on such rates in calculating the aggregate production for the Company.

The term "boe" may be misleading, particularly if used in isolation. A boe conversion of 6 Mcf:1 bbl is based on the energy equivalency conversion method primarily applicable at the burner tip and does not represent a value equivalency at the wellhead.

Neither the TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.

Contact Information

  • Renegade Petroleum Ltd.
    Michael Erickson
    President & CEO
    (403) 355-8922

    Renegade Petroleum Ltd.
    Alex Wylie
    Vice-President, Finance & CFO
    (403) 410-3376