CALGARY, Jan. 19 /CNW/ - Twin Butte Energy Ltd. ("Twin Butte" or the
"Company") (TSX: TBE) is pleased to provide initial 2009 guidance as well as
an update on current operations.
The Board of Directors has recently approved Twin Butte's 2009 Capital
and Operating Plan. In light of the prevailing economic slowdown and
uncertainty in near term commodity prices Twin Butte, like many peers has
elected to execute a capital program which will be entirely funded from cash
flow. It is our intent to slightly under spend cash flow in the first half of
the year until we gain greater clarity on the operating environment and market
conditions. Paramount to our plan is to maintain balance sheet flexibility
while positioning the company for long term growth within our focus areas.
Twin Butte's net debt at the end of 2008 was approximately $49 million with a
current bank line of $65 million.
Capital spending in 2009, is forecast to be between $17 and $19 million
concentrated in NE British Columbia as well as in Jayar and Thunder Alberta.
The program will entail drilling 11 gross (9.5 net) wells; numerous
recompletion and tie in of standing well operations; as well as a number of 2
and 3 dimensional seismic programs. Based on forecast results of the program,
corporate production should average slightly greater than 3,000 boe's per day,
a modest increase from 2008 average production.
Twin Butte's winter program has commenced with a new pool gas discovery
at Oak in NE British Columbia, the first of a three well program in the area.
Production optimization work is ongoing at Jayar with positive results while
our second horizontal well has been deferred to later in the year for capital
allocation reasons. At Thunder seismic programs are progressing along with
successful land sale activity.
The Board and new management team at Twin Butte are committed to adding
value for our shareholders through the long term execution of our business
plan. The current economic environment dictates a cautious approach to
spending. With a current inventory of over 100 drilling locations and 150,000
net undeveloped acres of land we will pursue creative ways to monetize these
opportunities while growing our presence within our core focus areas.
Twin Butte is a value oriented junior gas producer with expanding
operations in N.E. British Columbia and N.W. Alberta. With a stable low
decline production base the company is well positioned to live within our
means while continuing to enhance our focus areas. We believe numerous
consolidation opportunities will present themselves in 2009, and we have the
Board and Team to execute on such opportunities and are committed in this
Certain information regarding Twin Butte set forth in this news release
including management's assessment of the Company's future plans and
operations, the effect on the Company and on shareholders of Twin Butte,
production increases and future production levels contain forward-looking
statements that involve substantial known and unknown risks and uncertainties.
These forward-looking statements are subject to numerous risks and
uncertainties, certain of which are beyond Twin Butte's control including,
without limitation, the impact of general economic conditions, industry
conditions, volatility of commodity prices, currency fluctuations, imprecision
of reserve estimates, environmental risks, competition from other producers,
lack of availability of qualified personnel, stock market volatility, ability
to access sufficient capital from internal and external sources and
uncertainty related to the effect of the Arrangement. Twin Butte's actual
results, performance or achievements may differ materially from those
expressed in, or implied by, these forward-looking statements and,
accordingly, no assurance can be given that any events anticipated by the
forward-looking statements will transpire or occur, or if any of them do so,
what benefits that Twin Butte will derive therefrom. Additional information on
these and other factors that could affect Twin Butte's results are included in
reports on file with Canadian securities regulatory authorities and may be
accessed through the SEDAR website (www.sedar.com), or Twin Butte's website
(www.twinbutteenergy.com). Furthermore, the forward-looking statements
contained in this joint news release are made as at the date of this joint
news release and Twin Butte does not undertake any obligation to update
publicly or to revise any of the forward-looking statements, whether as a
result of new information, future events or otherwise, except as may be
required by applicable securities laws.
In this news release, reserves and production data are commonly stated in
barrels of oil equivalent ("BOE") using a six to one conversion ratio when
converting thousands of cubic feet of natural gas ("Mcf") to barrels of oil
("bbl") and a one to one conversion ratio for natural gas liquids ("NGLs" or
"ngls"). Such conversion may be misleading, particularly if used in isolation.
A BOE conversion ratio of 6 Mcf: 1 bbl is based on energy equivalency
conversion method primarily applicable at the burner tip and does not
represent a value equivalency at the wellhead.
The TSX does not accept responsibility for the adequacy or accuracy of
this news release.
For further information:
For further information: Twin Butte Energy Ltd., 600, 334 - 8th Avenue
S.W., Calgary, Alberta, T2P 2Z2; Jim Saunders, President and Chief Executive
Officer, (403) 215-2040; or R. Alan Steele, Vice President Finance and Chief
Financial Officer, (403) 215-2692; www.twinbutteenergy.com