(TSX Symbol - PEF; NYSE Amex Symbol - PED)
CALGARY, Sept. 28 /CNW/ - Petroflow Energy Ltd. announces today that the Company has entered into a financial hedge position with respect to 6800 MMBTU per day of gas production. The hedge consists of 6800 MMBTU per day at a fixed price of $7.25 (USD) per MMBTU for a period from October 1, 2009 to December 31, 2010, followed by a fixed price of $5.33 (USD) per MMBTU for the period January 1, 2011 to September 30, 2012.
Mr. Sandy Andrew, President & COO of Petroflow stated, "In light of the current economic environment, we elected to secure a price that is attractive in relationship to the current spot market prices for natural gas. This specific hedge agreement covers over 25% of our current working interest production levels and provides Petroflow with a stabilized price which is in excess of current market prices. Combined with existing hedges, the Company has downside price protection on over 40% of its current working interest production for the next two years."
"The degree of uncertainty in the oil and gas marketplace encouraged us to adopt this hedging strategy as insulation against further price declines. This hedge agreement will provide greater certainty in our future gas revenues in these challenging times," added Mr. Andrew.
Forward Looking Statements
This news release contains statements about oil and gas production and operating activities that may constitute "forward-looking statements" or "forward-looking information" within the meaning of applicable securities legislation as they involve the implied assessment that the resources described can be profitably produced in the future, based on certain estimates and assumptions.
Forward-looking statements are based on current expectations, estimates and projections that involve a number of risks, uncertainties and other factors that could cause actual results to differ materially from those anticipated by Petroflow and described in the forward-looking statements. These risks, uncertainties and other factors include, but are not limited to, fluctuations in oil and gas prices, adverse general economic conditions, operating hazards, drilling risks, inherent uncertainties in interpreting and applying engineering data, geologic data, and accumulated operating and production knowledge, technology change and failure, competition, reduced availability of drilling and other well services, prices for drilling and other well services, government regulation and foreign political risks, fluctuations in the exchange rate between Canadian and US dollars and other currencies, as well as other risks commonly associated with the exploration and development of oil and gas properties.
Additional information on these and other factors, which could affect Petroflow's operations or financial results, are included in Petroflow's reports on file with Canadian and United States securities regulatory authorities. We assume no obligation to update forward-looking statements should circumstances or management's estimates or opinions change unless otherwise required under securities law.
The TSX has not reviewed and does not accept responsibility for the
adequacy or accuracy of this news release.
SOURCE PETROFLOW ENERGY LTD.
For further information: For further information: Mr. Sanford Andrew, President & COO, Petroflow Energy Ltd., (307) 277-2145, www.petroflowenergy.com; Mr. Duncan Moodie, Chief Financial Officer, Petroflow Energy Ltd., (403) 539-4320, www.petroflowenergy.com