Toronto Stock Exchange: SCS
82,899,295 Common Shares
CALGARY, Dec. 13 /CNW/ - Second Wave Petroleum Inc. ("Second Wave" or
the "Company") is providing the following update on its Judy Creek
On December 10th, the Company experienced a fire at its Judy Creek 08-24-063-10W5 gas
plant resulting in the plant's gas refrigeration system and the
associated building suffering significant damage. While the exact cause
of the fire is under review, it appears the fire commenced while third
party mechanics were completing routine maintenance on a compressor
engine within the refrigeration building. No injuries occurred during
this incident and the fire was contained to the single building. Both
the third party contractors and Second Wave operations personnel
responded quickly to the situation resulting in the fire being
isolated. All corporate, regulatory and emergency personnel were
appropriately notified in a timely manner.
The extent of the damage to the facility will require the Company to
replace the unit, the installation of which is expected to take 15 to
20 days. The Company believes that insurance proceeds will cover
substantially all of the associated costs.
Prior to the outage, Judy Creek production had reached a daily net rate
of approximately 1,300 boe/d with approximately 1,050 boe/d being
produced from the Company's Judy Creek Pekisko oil battery. As solution
gas from the Company's Pekisko oil battery is processed exclusively at
the damaged 08-24-063-10W5 gas plant, production of approximately 1,050
boe/d was shut in on December 10, 2010 as the Company could no longer
meet its hydrocarbon due point requirements on its sales gas stream.
The Company's Judy Creek Ellerslie oil battery, which produces
approximately 250 boe/d, will remain on line during this outage as the
solution gas from this battery is processed at a third party facility.
The Company had completed the tie-in of its 100% working interest
09-13-063-10W5 and 12-14-063-09W5 Pekisko horizontal oil wells on
December 5 with both wells still cleaning up prior to the outage. The
start up of the Company's 03-14-063-09W5 Gilwood gas well and its
05-14-063-09W5 Pekisko horizontal oil well, both of which tie into the
Company's Pekisko oil battery, was scheduled for December 14, 2010.
Behind pipe volumes associated with these four wells is estimated at
600 boe/d and as such the temporary outage of the Company's gas plant
will result in the shut in of approximately 1,650 boe/d of net
production over the repair period.
The Company will provide additional guidance on progress made on repairs
to the facility and related start up as timing becomes clearer.
Barrels of Oil Equivalent (BOEs). The term BOE refers to barrel of oil equivalent, with natural gas
converted to crude oil equivalent at a ratio of six thousand cubic feet
to one barrel. BOEs may be misleading, particularly if used in
isolation. A BOE conversion ratio of six mcf (six thousand cubic feet)
to one bbl (one barrel) is based on an energy equivalency conversion
method primarily applicable at the burner tip and does not represent a
value equivalency at the wellhead.
Forward-Looking Statements. This news release contains forward-looking statements as to the
Company's internal projections, expectations and beliefs relating to
future events or circumstances. Forward-looking statements are
typically (but not necessarily) identified by words such as
"anticipate", "believe", "plan", "estimate", "expect", "plan",
"intend", "potential", "may", "will", "should" or similar words
suggesting future outcomes. Although the Company believes that these
forward-looking statements are reasonable, undue reliance should not be
placed on them as they are subject to known and unknown risks and
uncertainties, many of which are beyond the Company's control.
Forward-looking statements are not guarantees of future outcomes. There
can be no assurance that the plans, intentions or expectations
contained in the forward-looking statements or upon which they are
based will in fact occur or be realized, and actual results may differ
from those expressed or implied in the forward-looking statements. The
difference may be material.
Second Wave is subject to the inherent risks associated with the
exploration, development, exploitation and production of oil and gas.
More particularly, material risk factors that could cause actual
results to differ materially from those expressed or implied in the
forward-looking statements contained in this news release include:
adverse changes in commodity prices, interest rates or currency
exchange rates; accessibility of capital when required and on
acceptable terms; lower than expected production of crude oil and
natural gas; production delays; lower than expected reserve volumes on
the Company's properties; increased operating costs; ability to attract
and retain qualified personnel or to secure drilling rigs and other
services on acceptable terms; competition for labour, equipment and
materials necessary to advance the Company's projects; unforeseen
engineering, environmental or geological problems; ability to obtain
all required regulatory approvals on a timely basis and on satisfactory
terms; and changes in laws and governmental regulations (including with
respect to taxes and royalties). This list is not exhaustive. Readers
should also review the risk factors described in other documents filed
by the Company from time to time with securities regulatory authorities
in Canada, including its most recent annual information form, copies of
which are available electronically at www.sedar.com and at
Specific forward-looking statements contained in this news release
include statements regarding: the extent to which repair costs will be
covered by insurance; the anticipated timing for completing the
installation of a replacement unit; and the amount of production that
will be shut in pending completion of repairs. In making such
forward-looking statements, Second Wave has made various assumptions
regarding, among other things: the accuracy of geological and
geophysical data and interpretations of that data; future oil and
natural gas prices; future capital requirements; future exchange rates;
the accessibility and cost of associated services; the Company's
ability to economically produce oil and gas from its properties and the
timing and cost to do so; and its ability to obtain qualified staff,
equipment and supplies in a timely and cost-efficient manner.
The forward-looking statements included herein are made as of the date
of this news release and Second Wave undertakes no obligation to
publicly update or revise any forward-looking statements, whether as a
result of new information, future events or otherwise, except as may be
required by securities laws.
SOURCE Second Wave Petroleum Inc.
For further information: For further information:
Colin B. Witwer, President and CEO
Randy Denecky, VP, Finance and CFO
Telephone: (403) 451-0165