Argent Energy Trust announces higher than expected second quarter production and provides operational update

CALGARY, July 24, 2014 /CNW/ - Argent Energy Trust ("Argent" or the "Trust") (TSX: AET.UN) is pleased to report that second quarter 2014 production averaged approximately 6,373 barrels of oil equivalent per day ("boe/d"), (approximately 69% oil and NGLs), exceeding previously announced second quarter production guidance of 6,100 to 6,200 boe/d. During the month of July, Argent achieved a new all-time daily production high, a milestone that is reflected in the Trust's 30-day production average of approximately 7,200 boe/d. This production level reflects initial flush rates from planned new Eagle Ford oil and South Escobas natural gas wells that were brought on that are subject to high decline rates.

During the second quarter, Argent successfully completed and brought onstream one new South Escobas well, Violeta Ranch #8, and two new Eagle Ford wells, namely the Makers 1H and Makers 3H. In addition, the Trust successfully drilled two new Eagle Ford wells, Haydens 2H and Haydens 3H, both of which were successfully completed and brought onstream subsequent to the quarter's end. The Haydens 2H and Haydens 3H wells are in the initial stages of flowback and it will be a number of weeks before the results of the wells can be fully evaluated. Further commentary will be provided in conjunction with the release of the second quarter financial results. This marks the completion of Argent's 2014 drilling program.

The Trust continues to review plans to rationalize a portion of its assets. As part of this review process, Argent has recently entered into a purchase and sale agreement to sell certain properties located in Kansas for approximately US$10 million. Current production from these properties is approximately 95 boe/d. This transaction is expected to close by August 13, 2014.  Proceeds will be used to reduce the amounts drawn under the credit facility, which remains at US$160 million following its recent annual review. Upon completion of the sale, Argent will have approximately US$50 million of undrawn capacity on its credit facility. With the drilling component of the 2014 capital program having drawn to a close, Argent expects indebtedness to continue to decrease over the balance of the year. The Trust is also currently evaluating offers on its third party operated production payment and royalty interest; however the timeline to close has been extended as a result of the recently announced Forest Oil Corporation (the operator) and Sabine Oil & Gas LLC transaction.

Given the above, Argent is revising its average annual production guidance for 2014 from approximately 6,000 boe/d (approximately 68% oil and NGLs) to an expected range of 6,200 to 6,300 boe/d, and increasing its Q3 2014 guidance to an expected range of 6,400 to 6,500 boe/d from previous guidance of 6,100 to 6,200 boe/d.

The Trust will release full operating and financial results for the second quarter ended June 30, 2014 on Wednesday, August 13, 2014.

Note About Forward-Looking Statements

This press release includes forward-looking information within the meaning of applicable Canadian and United States securities legislation.  All statements, other than statements of historical facts, that address activities, circumstances, events, outcomes and other matters that Argent budgets, forecasts, plans, projects, estimates, expects, believes, assumes or anticipates (and other similar expressions) will, should or may occur in the future, are considered forward-looking information.

In particular, forward-looking information contained in this press release includes, but is not limited to, Argent's capital program, drilling and completion plans, oil, natural gas and NGL production rates, operating costs, production growth, availability under credit facilities, ability to close on sale of its third party operated production payment, source of funding for capital expenditures and the Trust's expectation regarding its average working interest production rate for the third quarter and year 2014. With respect to forward-looking statements contained in this press release, assumptions have been made regarding, among other things, future oil and natural gas prices, future currency exchange and interest rates, the regulatory framework governing taxes in the US and Canada and the Trust's status as a "mutual fund trust" and not a "SIFT trust", estimates of anticipated production from the Trust's assets, which estimates are based on the proposed drilling program with a success rate that, in turn, is based upon historical drilling success and an evaluation of the particular wells to be drilled, future recoverability of reserves from the assets, future capital expenditures and the ability of the Trust to obtain financing on acceptable terms for its capital projects and future acquisitions, and the Trust's capital budget (which is subject to change in light of ongoing results, prevailing economic circumstances, commodity prices and industry conditions and regulations).

The forward-looking information provided in this press release is based on management's current beliefs, expectations and assumptions, based on currently available information as to the outcome and timing of future events.  Argent cautions that its future oil, natural gas and natural gas liquids production, revenues, cash flows, liquidity, plans for future operations, expenses, outlook for oil and natural gas prices, timing and amount of future capital expenditures, and other forward-looking information is subject to all of the risks and uncertainties normally incident to the exploration for and development and production and sale of oil and gas.

These risks include, but are not limited to, oil and natural gas price volatility, Argent's access to cash flows and other sources of liquidity to fund its capital expenditures, its level of indebtedness, its ability to replace production, the impact of the current financial climate on Argent's anticipated business and financial condition, a lack of availability of or increases in costs of goods and services, environmental risks, drilling and other operating risks, regulatory changes, the uncertainty inherent in estimating future oil and gas production or reserves, economic conditions and other risks as described in documents and reports that Argent files with the securities commissions or similar authorities in applicable Canadian jurisdictions on the System for Electronic Document Analysis and Retrieval (SEDAR).  Any of these factors could cause Argent's actual results and plans to differ materially from those contained in the forward-looking information.

There are many factors that could result in production levels being less than anticipated, including greater than anticipated declines in existing production due to poor reservoir performance, the unanticipated encroachment of water or other fluids into the producing formation, mechanical failures or human error or inability to access production facilities, among other factors.

Forward-looking information is subject to a number of risks and uncertainties, including those mentioned above, that could cause actual results to differ materially from the expectations set forth in the forward-looking information.  Forward-looking information is not a guarantee of future performance or an assurance that our current assumptions and projections are valid.  All forward-looking information speaks only as of the date of this press release, and Argent assumes no obligation to, and expressly disclaims any obligation to, update or revise any forward-looking information, except as required by law.  You should not place undue reliance on forward-looking information.  You are encouraged to closely consider the additional disclosures and risk factors contained in Argent's periodic filings on SEDAR that discuss in further detail the factors that could cause future results to be different than contemplated in this press release.

Note regarding barrel of oil equivalency

Barrels of oil equivalent (boe) may be misleading, particularly if used in isolation.  A boe conversion ratio of six Mcf to one bbl is based on an energy equivalency conversion method primarily applicable at the burner tip and do not represent a value equivalency at the wellhead.  Given that the value ratio based on the current price of oil as compared to natural gas is significantly different from the energy equivalency conversion ratio of six to one, utilizing a boe conversion ratio of six Mcf to one bbl may be misleading as an indication of value.

Argent is a mutual fund trust under the Income Tax Act (Canada) (the "Tax Act").  Argent's objective is to create consistent returns for investors through the acquisition and development of oil and natural gas reserves and production with low risk exploration potential, located primarily in the United States.  Material information pertaining to Argent Energy Trust may be found on or

SOURCE: Argent Energy Trust

For further information:

John Elzner
President & Chief Executive Officer
Argent Energy Trust
(832) 320-9206

Sean Bovingdon 
Chief Financial Officer 
Argent Energy Trust 
(403) 770-4809

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Argent Energy Trust

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