Thunder Energy Trust
TSX : THY.UN

Thunder Energy Trust

September 15, 2005 08:50 ET

Thunder Energy Trust Expands 2005 Capital Program

CALGARY, ALBERTA--(CCNMatthews - Sept. 15, 2005) - Thunder Energy Trust (TSX:THY.UN) announces operational update.

Capital Update

H2/05 estimated capital expenditures have increased by $16 million to $43 million and consists of drilling 58 (46.3 net) wells which combined with the recommencement of production from Whiskey Creek will enable us to achieve our targeted exit rates.

Production

August production was 11,200 boed (42.5 mmcfd of natural gas and 4,100 bbld of crude oil and natural gas liquids) and does not include full production from three existing wells at Whiskey Creek near Priddis, Alberta. After a prolonged shut-in period due to facility constraints, Whiskey production is expected to come on progressively over the month of September. Production from the area is expected to reach 3.4 mmcfd and 200 bbld of natural gas liquids by the end of September. Further production increases in the area are expected in late November when facilities are installed for a third well, which has recently been completed.

Due to weather delays experienced industry wide and plant start-up problems related to Whiskey Creek, 2005 production exit rate is now targeted between 12,100 boed (45 mmcfd of natural gas and 4,600 bbld of crude oil and natural gas liquids) and 12,700 boed (47.5 mmcfd of natural gas and 4,800 bbld of crude oil and natural gas liquids).

"Notwithstanding the third quarter production volume delays, we are confident in achieving our targeted exit volumes. Based on current commodity prices our monthly distribution of $0.15 per unit remains intact. Payout ratios are estimated at 53%. Furthermore, our current yield of 13.2% makes an attractive investment in the royalty trust sector compared to a peer group average of 10.6%", said Stuart Keck, President and CEO of Thunder Energy Trust.

The following table provides current operational and financial detail:



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Crude
Natural Gas Oil and NGLs Total
(mmcfd) (bbld) (boed)

August Production 42.5 4,100 11,200
Target Exit 2005
Production 45.0 to 47.5 4,600 to 4,800 12,100 to 12,700
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Current Net Debt $149 million

Current Yield 13.20%
Units outstanding 42.5 million(a)
Exchangeable shares outstanding 3.4 million
Expected capital expenditures $43 million
For the six months ended Dec. 31, 2005
Monthly distribution $0.15 per unit
Hedging outstanding Less than 1% of production
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(a) Approximately 1.0 million "out of the money" options were not
exercised subsequent to closing the plan of arrangement.

Commodity price estimates based on: 2005
Crude oil - WTI (US$/bbl) $65.00
Natural gas - AECO (CDN$/mcf) $9.00
Exchange rate (US$/C$) $0.82


Thunder Energy Trust is a new oil and gas income trust created as a result of the plan of arrangement, which combined three entities Thunder Energy Inc., Mustang Resources Inc. and Forte Resources Inc.

Forward-looking Statements

This press release may contain forward-looking statements including expectations of future production, cash flow and earnings. These statements are based on current expectations that involve a number of risks and uncertainties, which could cause actual results to differ from those anticipated. These risks include, but are not limited to: the risks associated with the oil and gas industry (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, and health, safety and environmental risks), commodity price and exchange rate fluctuation and uncertainties resulting from potential delays or changes in plans with respect to exploration or development projects or capital expenditures. Additional information on these and other factors that could affect the Company's operations or financial results are included in the Company's reports on file with Canadian securities regulatory authorities.

"Note: Boe means barrel of oil equivalent on the basis of 1 boe to 6,000 cubic feet of natural gas. Boe's may be misleading, particularly if used in isolation. A boe conversion ratio of 1 boe for 6,000 cubic feet of natural gas is based on an energy equivalency conversion method primarily applicable at the burner tip and does not represent a value equivalency at the wellhead. Boe/d means a boe per day."

Contact Information

  • Thunder Energy Trust and Thunder Energy Inc.
    Stuart Keck
    President & C.E.O.
    (403) 294-1635
    (403) 232-1317 (FAX)
    or
    Thunder Energy Trust and Thunder Energy Inc.
    Brent Kirkby
    Vice President, Finance and C.F.O.
    (403) 294-1635
    (403) 232-1317 (FAX)
    Website: www.thunderenergy.com