CALGARY, April 14 /CNW/ - Cequence Energy Ltd. ("Cequence" or the "Company") (TSX: "CQE") is pleased to provide the following operational update on its ongoing Montney program in the Sinclair area of North Western Alberta.
Cequence has successfully completed its first Lower Montney horizontal well at Sinclair (the "Discovery Well"). The Discovery Well is 100% owned and was tested over a five day period with a final stabilized flow rate of 4.3 mmcf/d at a flowing pressure of 900 psi. Cequence has 15 gross (14.5 net) sections of land offsetting the Discovery Well with the potential for 59 gross (57 net) additional Lower Montney drilling locations. Cequence has tested gas from the Lower Montney in three offsetting vertical wells with very similar log characteristics to the Discovery Well. A second horizontal Lower Montney well (50% WI) is expected to be drilled after break-up. Cequence's year-end independent reserves report did not assign any reserves to the Company's Lower Montney assets.
With the successful Discovery Well, Cequence has expanded the natural gas resource to include both the Upper and Lower Montney at Sinclair. Over the past six months, three horizontal wells have been drilled and completed at Sinclair with total tested productivity of approximately 14 mmcf/d. With the additional productive capability and the low H(2)S (sour) content of gas from the Lower Montney, Cequence continues to evaluate tie-in alternatives in the area, including the potential construction of our own gas plant.
The Company is also pleased to announce that it has successfully added production from its winter drilling program in the Peace River Arch. As a result, Cequence's current production is approximately 3,150 boe/d as compared to 2,089 boe/d in Q4 2009 representing an increase of 50%. The Company's Q1 2010 production is expected to average 2,500 boe/d. Cequence continues to focus its 2010 capital program on oil and liquids-rich natural gas prospects with the objective of continuing to control costs and deliver higher netbacks.
Forward Looking Information
Certain information included in this press release constitutes forward-looking information under applicable securities legislation. Such forward-looking information is provided for the purpose of providing information about management's current expectations and plans relating to the future. Readers are cautioned that reliance on such information may not be appropriate for other purposes, such as making investment decisions. Forward-looking information typically contains statements with words such as "anticipate", "believe", "expect", "plan", "intend", "estimate", "propose", "project" or similar words suggesting future outcomes or statements regarding an outlook. Forward-looking information in this press release may include, but is not limited to, information with respect to: operational decisions and the timing thereof, development and exploration plans and the timing thereof; and future production levels. Forward-looking information is based on a number of factors and assumptions which have been used to develop such information but which may prove to be incorrect. Although the Company believes that the expectations reflected in such forward-looking information is reasonable, undue reliance should not be placed on forward-looking information because the Company can give no assurance that such expectations will prove to be correct. In addition to other factors and assumptions which may be identified in this press release, assumptions have been made regarding and are implicit in, among other things: field production rates and decline rates; the ability of the Company to secure adequate product transportation; the impact of increasing competition in or near the Company's Doig / Montney plays; the extent to which the Company's reserves evaluators will attribute reserves to the Company's Doig / Montney plays; the timely receipt of any required regulatory approvals; the ability of the Company to obtain qualified staff, equipment and services in a timely and cost efficient manner to develop its business; Cequence's ability to operate the properties in a safe, efficient and effective manner; the ability of the Company to obtain financing on acceptable terms; the ability to replace and expand oil and natural gas reserves through acquisition, development of exploration; the timing and costs of pipeline, storage and facility construction and expansion; future oil and natural gas prices; currency, exchange and interest rates; the regulatory framework regarding royalties, taxes and environmental matters; and the ability of the Company to successfully market its oil and natural gas products. Readers are cautioned that the foregoing list is not exhaustive of all factors and assumptions which have been used.
Forward-looking information is based on current expectations, estimates and projections that involve a number of risks and uncertainties which could cause actual results to differ materially from those anticipated by the Company and described in the forward-looking information. The material risk factors affecting the Company and its business are contained in the Company's Annual Information Form which is available under the Company's issuer profile on SEDAR at www.sedar.com.
The forward-looking information contained in this press release is made as of the date hereof and the Company undertakes no obligation to update publicly or revise any forward-looking information, whether as a result of new information, future events or otherwise, unless required by applicable securities laws. The forward looking information contained in this press release is expressly qualified by this cautionary statement.
Boes are presented on the basis of one Boe for six Mcf of natural gas. Disclosure provided herein in respect of Boes may be misleading, particularly if used in isolation. A Boe conversion ratio of 6 Mcf:1 Bbl is based on an energy equivalency conversion method primarily applicable at the burner tip and does not represent a value equivalency at the wellhead.
The Toronto Stock Exchange has neither approved nor disapproved the contents of this press release.
SOURCE Cequence Energy Ltd.
For further information: For further information: Howard Crone, President and Chief Executive Officer, (403) 806-4040, firstname.lastname@example.org; or David Gillis, Vice President Finance and Chief Financial Officer, (403) 806-4041, email@example.com