Rockyview Energy Inc.

Rockyview Energy Inc.

April 19, 2007 16:45 ET

Rockyview Energy Increases 2007 Capital Budget

CALGARY, ALBERTA--(CCNMatthews - April 19, 2007) - Rockyview Energy Inc. ("Rockyview" or the "Company") (TSX:RVE) is pleased to announce that its board of directors has approved a $5 million increase to the Company's 2007 capital budget to bring total anticipated expenditures on drilling, completions, facilities, land and seismic to $25 million.

The original budget (news release dated December 13, 2006) contemplated $20 million in expenditures on an average 2007 natural gas reference price of C$6.50 per thousand cubic feet ("mcf'). Rockyview's production is leveraged approximately 95% to natural gas. Year-to-date, the price of natural gas at AECO has averaged C$7.40 per mcf, with the forward strip for the balance of the year trading at approximately C$7.92 per mcf. The Company also has approximately thirty-seven percent of its gas production hedged at a minimum price of $7.80 per mcf, with the opportunity to participate beyond that level through the use of collars.

"Given the commodity price environment and our hedges, we felt comfortable that stepping up our drilling program was the right move at this time", noted Rockyview President and Chief Executive Officer Steve Cloutier.

Mr. Cloutier also pointed to an improvement in the Company's capital costs as figuring into their deliberations, as well as new locations being added to their drilling inventory. "In addition to a well-managed drilling and completions program, we have been capitalizing on a reduction in some shallow gas service costs. Complementing this is recent success on a farm-in in our Central Alberta core area that sets up 10 incremental locations that efficiently fit within our current drilling plans".

Year to date, the Company has drilled 29 (20.5 net) wells, resulting in 18 (14.0 net) gas wells, 9 (5.5 net) wells cased for gas and awaiting completion and 2 (1 net) abandoned wells. The Company has also re-completed 5 (3 net) other shallow gas wells. All the successful wells are expected to be tied-in following spring break-up during the second quarter. The Company has a two to three-year drilling inventory comprised of low-risk shallow gas prospects and high impact plays and intends to allocate an increasing amount of human and financial resources to expanding its exploration initiatives.

Total expenditures on drilling, completions and re-completions for the first quarter are expected to be approximately $8.0 million. Management estimates that total tie-in costs will amount to approximately $3.0 million.

In addition, Rockyview has invested approximately $550,000 on land and seismic acquisitions. More than 2,000 net acres have been acquired since the beginning of the year, predominantly in the Peace River Arch, where Rockyview continues to build on a number of geological opportunities.

The increased $5 million in drilling activity will occur during the third and fourth quarters, with most of the budgeted capital allocated to exploration and development initiatives in the Company's Central Alberta and Peace River Arch core areas.

Reader Advisory - Statements in this news release contain forward-looking information including expectations of future production, expectations of future expenditures and capital costs, plans for exploration, development and drilling activities and other operational developments. Readers are cautioned that assumptions used in the preparation of such information may prove to be incorrect. Events or circumstances may cause actual results to differ materially from those predicted, a result of numerous known and unknown risks, uncertainties, and other factors, many of which are beyond the control of the Company. These risks include, but are not limited to: the risks associated with the oil and gas industry, commodity prices and exchange rate changes. Industry related risks include, but are not limited to; operational risks in exploration, development and production, delays or changes in plans, risks associated with the uncertainty of reserve estimates, health and safety risks and the uncertainty of estimates and projections of production, costs and expenses. The risks outlined above should not be construed as exhaustive. The reader is cautioned not to place undue reliance on this forward-looking information. The Company undertakes no obligation to update or revise any forward-looking statements except as required by applicable securities laws.

The Toronto Stock Exchange has neither approved nor disapproved of the contents of this news release.

Contact Information

  • Rockyview Energy Inc.
    Steve Cloutier
    President & C.E.O.
    (403) 538-5000
    (403) 538-5050 (FAX)
    Rockyview Energy Inc.
    Alan MacDonald
    Vice President, Finance, C.F.O. & Corporate Secretary
    (403) 538-5000
    (403) 538-5050 (FAX)