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CALGARY, April 26 /CNW/ - During 2006, Angle Energy Inc. enjoyed
exceptional success with a primary focus on our Harmattan core area. We are
pleased to report the following results achieved during the period ended
December 31, 2006:
- Recorded independently evaluated reserves (GLJ) additions to
December 31, 2006 of 5,034 mboes or 431% on proved and 11,011 mboes
or 795% on proved plus probable.
- Achieved F&D costs of $12.27/boe proved and $7.58/boe proved plus
probable (including future capital), resulting in recycle ratios of
1.7 for proved and 2.7 for proved plus probable.
- Drilled 22 gross (18.7 net) wells - 13 development and 9 exploratory
- for a 74% net success rate.
- Expanded our drilling prospect inventory in our core
Harmattan/Crossfield area (development Mannville sand play and higher
impact Elkton play) as well as our emerging Ferrier area.
- Entered 2006 with production of 35 boe/d and exited in excess of
3,500 boe/d with current production at approximately 4,000 boe/d.
- Added production at a cost of $16,681/boe (2006 capital by 2006
- Realized average production of 1,281 boe/d for the period compared to
14 boe/d in 2005.
- Generated cash flow of $7,985,000 or $0.28 per share and income of
$1,543,000 or $0.05 per share.
- In December 2006, the Company issued 1,800,000 common shares at a
price of $5.00 per share and 500,000 flow-through common shares at a
price of $6.00 per share for gross proceeds of $12,000,000. We also
expanded our credit facility by $10 million for a total banking
facility of $20 million, which, together with this equity issue, will
allow us to take advantage of our expanded drilling prospect
Harmattan, which is our core area, has contributed all of our production
to date. This production is comprised of 48% natural gas liquids and 52%
natural gas, providing a superior overall gas value compared to dry gas
production. During 2006, we drilled 16 gross (15.2 net) wells in the Harmattan
region and were successful on 13 gross (12.2 net) wells for a net success rate
of 80%. Our drilling targets the Mannville and Elkton zones in this area.
During 2006, we were successful in discovering a new Elkton pool that has
yielded two high deliverability wells that came on production in November
2006. Our year-end area exit rate was in excess of 3,500 boe/d producing from
11 Harmattan area wells, and at period-end we had 11 wells still to tie-in
from our 2006 drilling projects. During the latter part of 2006, we began
construction on a 15-kilometre pipeline to the Taylor gas plant. We expect to
complete construction on this pipeline by May 2007 and to achieve production
in excess of 4,800 boe/d in Harmattan alone by the end of June 2007. The
Company currently has over two years of development drilling identified in the
Harmattan/Crossfield area and we expect to drill 17 wells here in 2007. Of our
planned capital expenditures that will range from $51 to $55 million in 2007,
70% will be dedicated to the Harmattan area, which is further split into 2/3
on our major farm-in lands and 1/3 on other Crown and freehold lands.
During 2006, we drilled 3 gross (2.3 net) wells in Ferrier and were
successful on 2 gross (1.3 net) wells for a net 57% success rate. Angle was
the operator of two of the three wells. These wells are expected to contribute
an additional 160 boe/d net to Angle. Additionally, the Company participated
in a non-operated well at Carson Creek (22% W.I.), which was placed on
production in 2006 at 35 boe/d net to Angle (well is restricted by pipeline
pressure). During 2007, we are planning a six-well development drilling
program at Ferrier. Infrastructure costs will be optimized within the program
and initial production from this area will commence in the second quarter of
2007. The Ferrier area will comprise 16% of Angle's overall capital budget in
Angle's drilling program for 2006 was very successful and has resulted in
top tier production and reserves growth, demonstrating strength in internal
prospect generation and excellent capital efficiency. Project capital costs
were 15% to 20% higher than comparative costs in 2005 and commodity prices
(particularly natural gas) experienced a drop of approximately 40%. For many
explorers in our basin, these factors resulted in a difficult fiscal 2006.
In our Alberta areas of operation, newly discovered gas pools are on
average smaller and less prolific than they have been historically, and
consequently, it will cost more to find less. However, we have demonstrated
that it is possible to turn good ideas into successful drilling prospects and
to provide a healthy return for our shareholders.
Angle increased production from 35 boe/d at the end of 2005 to our 2006
exit production level of greater than 3,500 boe/d. At year-end, we had
11 wells awaiting tie-in and, combined with the completion of our pipeline
project in the Harmattan area, these successful gas tests will result in
production growth to the 5,000 boe/d level in the second quarter of 2007. At
the end of first quarter of 2007, Angle was producing 4,000 boe/d and
anticipates exiting 2007 with corporate production of 5,200 to 5,500 boe/d,
representing a 50% increase over 2006.
During the first quarter of 2007, our drilling continued primarily in the
Harmattan region targeting a mixture of Elkton and Mannville reservoirs, and
during the second quarter we will extend into the Carstairs and Crossfield
areas in our pursuit of additional high impact Elkton reservoirs. In total for
all areas, we plan to drill 23 gross wells in 2007 with anticipated capital
expenditures of $51 to $55 million.
Continued volatility in natural gas prices, the announcement on taxation
of energy trusts, as well as rapid Company growth resulted in conditions that
were not conducive to taking our Company public. Consequently, we are
continuing to actively build our drilling inventory and remain opportunistic
with our timing and form of a liquidity event. We are pleased with the
achievements of our professional staff, the guidance from our Board and the
ongoing support of our shareholders. We look forward to reporting the results
of our ongoing efforts throughout 2007.
Angle Energy Inc. is a Calgary based private oil and gas exploration and
development company that was incorporated in 2004 and commenced active oil and
gas operations in 2005. Angle's proven and dedicated team of industry
specialists are focused on identifying and developing high quality assets in
the Western Canadian Sedimentary Basin, with an emphasis in west central
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For further information:
For further information: Gregg Fischbuch, President & CEO, or Heather
Christie-Burns, Vice President, Engineering and COO, or Stuart Symon, CFO at
(403) 263-4534, or e-mail the Company at firstname.lastname@example.org