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THE UNITED STATES/
CALGARY, Jan. 14 /CNW/ - Vero Energy Inc. ("Vero" or the "Company")
(TSX-VRO) reports that during the fourth quarter of 2008 the company drilled
12 (11.5 net) wells with a success rate of 100%. This includes 5 (5.0 net)
horizontal wells and two new pool discoveries. An additional one (1.0 net)
horizontal well was drilling over year end. For the year the Company drilled
34 (26.7 net) wells including 14 (12.2 net) horizontal wells for a 98% success
rate. Current production based on field estimates is over 8,400 boed (82%
During the fourth quarter the Company spent the majority of its
exploration and development capital in Edson where 7 (7 net) wells were
drilled, 5 of which were horizontal. The Company purchased 6,400 acres of
crown land in Edson with several drilling locations already identified.
Expansion of the existing Edson gas plant was ongoing through the year end,
which will increase throughput capacity from 20 mmcfd to 35 mmcfd. Vero will
maintain operatorship in the plant with its share of throughput capacity
increasing to 25 mmcfd. This facility was shut down for three days in the
first week of January 2009 for final installation of equipment and
commissioning. The expansion will allow continued drilling and production
increases from the southeastern portion of the Edson core area where downtime
due to third party infrastructure issues has occurred since the second quarter
Through a combination of acquisitions, lands earned through farm-ins and
crown land sales during the year the Company now has in excess of 171,000
acres of undeveloped land with 245 identified drilling locations and including
70 horizontal locations.
"Vero has increased its inventory of projects throughout 2008 and now has
the highest quality of projects and drilling inventory in its three year
history," said Doug Bartole, President and CEO. "We have shown the
repeatability of our resource with our high success rate, and have a
sustainable, self funding program which we believe will lead to continued
profitable growth. In the Edson area we believe we have one of the lowest
overall natural gas cost structures in Western Canada and potentially North
America. This allows us to continue to spend capital profitably in the current
commodity price environment."
In the first quarter of 2009 the Company plans to concentrate its efforts
in its core area of Edson where it has control of infrastructure and a low
capital and operating cost structure. Plans are to drill up to 10 - 12 (8.4 -
10.4 net) wells including 4 - 6 (4 - 4.7 net) horizontal wells.
The Company continuously evaluates the operating environment of the
industry, the outlook on commodities and our growing inventory of projects.
Vero's current 2009 capital budget of $90 million for exploration and
development is projected to achieve year over year, average production growth
of approximately 40%. Given the volatile commodity price and financial
environments, the Company will monitor and adjust its capital program
accordingly to maintain an appropriate balance between growth and financial
flexibility. The Company's short conversion time between capital spending and
cash flow allows our program to be self sustaining. In addition we expect our
growth to be accomplished in the same profitable manner as has been shown in
the first three years of existence. We believe this, along with our low cost
structure, is a competitive advantage for Vero which puts us in a category
with very few of our peers.
Vero Energy Inc. is a publicly traded Canadian energy company involved in
the exploration, development and production of oil, natural gas and liquids in
Alberta. The Company's shares trade on The Toronto Stock Exchange under the
symbol "VRO". Please visit our website for the latest presentation.
The Toronto Stock Exchange has neither approved nor disapproved of the
information contained herein.
Forward Looking Statements: Certain information regarding the Company in
this news release including management's assessment of future plans and
operations, production estimates, drilling inventory and wells to be drilled,
timing of drilling and tie-in of wells, productive capacity of new wells,
capital expenditures and the timing thereof, may constitute forward-looking
statements under applicable securities laws and necessarily involve risks
including, without limitation, risks associated with oil and gas exploration,
development, exploitation, production, marketing and transportation, loss of
markets, volatility of commodity prices, currency fluctuations, imprecision of
reserve estimates, environmental risks, competition from other producers,
inability to retain drilling rigs and other services, the timing and length of
plant turnarounds and the impact of such turnarounds and the timing thereof,
delays resulting from or inability to obtain required regulatory approvals and
ability to access sufficient capital from internal and external sources. As a
consequence, the Company's actual results, performance or achievements could
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 the Company will derive therefrom.
Readers are cautioned that the foregoing list of factors is not exhaustive.
Additional information on these and other factors that could effect the
Company's operations and financial results are included in reports on file
with Canadian securities regulatory authorities and may be accessed through
the SEDAR website (www.sedar.com), and the Company's website
(www.veroenergy.ca). Furthermore, the forward-looking statements contained in
this news release are made as at the date of this news release and the Company
does not undertake any obligation to update publicly or to revise any of the
included forward-looking statements, whether as a result of new information,
future events or otherwise, except as may be required by applicable securities
BOE Disclosure: Disclosure provided herein in respect of barrels of oil
equivalent (BOE) 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.
This press release is reproduced on Vero's website at www.veroenergy.ca.
Also for the latest presentation and other information about Vero Energy Inc.,
please visit the website (www.veroenergy.ca).
For further information:
For further information: Doug Bartole, President & CEO, at (403)
218-2063; Gerry Gilewicz, Vice-President Finance & Chief Financial Officer at
(403) 693-3170; Scott Koyich, Investor Relations, (403) 714-5979