Press release from Marketwire
Parallel Energy Trust Announces Record Production in the Second Quarter and Provides an Operations Update
Tuesday, July 02, 2013
Parallel Energy Trust Announces Record Production in the Second Quarter and Provides an Operations Update08:00 EDT Tuesday, July 02, 2013
CALGARY, ALBERTA--(Marketwired - July 2, 2013) - Parallel Energy Trust (TSX:PLT.UN) ("Parallel" or the "Trust") today provided a production update and reported the results of its 2013 drilling program to date.
Based on field data, Parallel's average daily production rate for the second quarter of 2013 is expected to be approximately 7,400 boe/day, which represents record quarterly production for the Trust. Production in the second quarter has been positively impacted by favourable drilling results in the Carson area and the previously announced closing of the Cargray acquisition.
Parallel drilled, completed and tied-in a total of five wells in the Carson area in the second quarter of 2013. The average 30 day initial production rate for the five wells drilled in the second quarter was 70 boe/day, which was 130% higher than the Trust's expected rate of 30 boe/day. In total, the Trust has completed 11 wells in the Carson area in the first half of 2013 with an average 30 day initial production rate for all 11 wells drilled in 2013 of 40 boe/day. This results in capital efficiencies of approximately $16,000 per flowing boe/day, on par with the Trust's expectations.
As a result of the strategic acquisition of the Cargray operating area, which closed on May 8, 2013, Parallel has suspended its drilling program for the second half of 2013. The acquisition, which cost approximately US$6.5 million, added approximately 200 boe/day of liquids-rich natural gas production. Parallel incurred the full cost of the acquisition in the second quarter of 2013 which has resulted in a temporary increase to the Trust's bank debt. The bank debt is estimated to be US$161.5 million at the end of the second quarter, which is expected to be reduced over the remainder of 2013 as there are minimal capital expenditures planned for the second half of the year. Parallel looks forward to recommencing its drilling program in 2014, with an inventory of more than 150 drilling locations.
"We are very pleased with the results of our 2013 drilling program and our improved production levels in the second quarter of 2013," said Rick Alexander, President and CEO of Parallel. "As a result of the many initiatives undertaken over the past number of months, the commitment of our operations and business development staff, and the performance of our asset base in a wide range of operating conditions, we are continuing to demonstrate the sustainability of our business model."
ABOUT PARALLEL ENERGY TRUST
Parallel's objectives are to create stable, consistent returns for investors through the acquisition and development of conventional oil and natural gas reserves and production with unexploited low risk potential in certain regions of the United States, and to pay out a portion of available cash to holders of trust units on a monthly basis. The trust units of Parallel are listed on the Toronto Stock Exchange ("TSX") under the symbol "PLT.UN" and the debentures are listed on the TSX under the symbol "PLT.DB".
Parallel is a "mutual fund trust" under the Income Tax Act (Canada) (the "Tax Act"). The Trust will not be a "SIFT trust" (as defined in the Tax Act), provided that the Trust complies at all times with its investment restriction which precludes the Trust from holding any "non-portfolio property" (as defined in the Tax Act). Further information relating to Parallel is set out in Parallel's annual information form dated March 25, 2013, which may be obtained on the SEDAR website at www.sedar.com under Parallel's profile.
This news release contains forward-looking information that involves substantial known and unknown risks and uncertainties, most of which are beyond the control of Parallel, including, without limitation, those listed under "Risk Factors" in Parallel's annual information form dated March 25, 2013 (collectively, "forward-looking information"). Forward-looking information in this news release includes, but is not limited to, Parallel's objectives and status as a mutual fund trust and not a SIFT trust and Parallel's expectations and estimates regarding current and future production rates and drilling results. Parallel cautions investors in Parallel's securities about important factors that could cause Parallel's actual results to differ materially from those projected in any forward-looking statements included in this news release. Any statements that express, or involve discussions as to, expectations, beliefs, plans, objectives, assumptions or future events or performance are not historical facts and may be forward-looking and may involve estimates, assumptions and uncertainties which could cause actual results or outcomes to differ materially from those expressed in such forward-looking statements. No assurance can be given that the expectations set out in Parallel's final prospectus or herein will prove to be correct and accordingly, prospective investors should not place undue reliance on these forward-looking statements. These statements speak only as of the date of this press release and Parallel does not assume any obligation to update or revise them to reflect new events or circumstances.
In this news release, Parallel and its subsidiaries are referred to collectively as the "Trust" or "Parallel" for purposes of convenience.
Oil and Gas Measures and Definitions
This press release contains disclosure expressed as "boe" and "boe/day". All oil and natural gas equivalency volumes have been derived using the ratio of six thousand cubic feet of natural gas to one barrel of oil. Equivalency measures may be misleading, particularly if used in isolation. A conversion ratio of six thousand cubic feet of natural gas to one barrel of oil is based on an energy equivalency conversion method primarily.
FOR FURTHER INFORMATION PLEASE CONTACT:
Parallel Energy Trust
Manager, Investor Relations
403-781-7888 or Toll-Free: 1-855-781-7888