Press release from CNW Group
Cequence Energy announces increased credit facility and current production
Thursday, May 30, 2013
Cequence Energy announces increased credit facility and current production18:48 EDT Thursday, May 30, 2013
CALGARY, May 30, 2013 /CNW/ - Cequence Energy Ltd. ("Cequence" or the "Company") (TSX: "CQE") is pleased to announce that the aggregate borrowing base under its credit facilities has been increased from $100 million to $125 million pursuant to the terms of a credit amending agreement between Cequence and a syndicate of Canadian chartered banks (the "Lenders").
The Lenders determine the amount of the borrowing base primarily through the Lender's assessment and analysis of the Company's oil and gas reserves and results of operations utilizing the Lenders forecasted commodity prices in such determinations. The next scheduled borrowing base re-determination is scheduled for November 2013. The Company currently has approximately $68 million presently drawn against the credit facilities which provides the Company with $57 million of available borrowing capacity and resulting financial flexibility.
Cequence is also pleased to announce that it has averaged over 11,000 boe/d of production for the first two months of the second quarter of 2013. The Company is currently awaiting dry weather conditions to allow it to access its 9-21 well to install surface facilities and bring this well onto production.
Cequence is a publicly traded Canadian energy company involved in the acquisition, exploitation, exploration, development and production of natural gas and crude oil in western Canada. Further information about Cequence may be found in its continuous disclosure documents filed with Canadian securities regulators at www.sedar.com.
Forward looking Statements or Information
Certain statements included in this press release constitute forward-looking statements or forward-looking information under applicable securities legislation. Such forward-looking statements or information are provided for the purpose of providing information about management's current expectations and plans relating to the future. Readers are cautioned that reliance on such information may not be appropriate for other purposes, such as making investment decisions. Forward-looking statements or information typically contain statements with words such as "anticipate", "believe", "expect", "plan", "intend", "estimate", "propose", "project" or similar words suggesting future outcomes or statements regarding an outlook. Forward-looking statements or information in this press release may include, but are not limited to, scheduled re-determinations of the Company's borrowing base under its credit facilities; expected financial flexibility provided by access to the increased credit facility; and operational plans for its 9-21 well and anticipated results therefrom. Forward-looking statements or information are based on a number of factors and assumptions which have been used to develop such statements and information but which may prove to be incorrect. Although the Company believes that the expectations reflected in such forward-looking statements or information are reasonable, however, undue reliance should not be placed on forward-looking statements because the Company can give no assurance that such expectations will prove to be correct. In addition to other factors and assumptions which may be identified in this press release, assumptions have been made regarding, among other things: the impact of increasing competition; the timely receipt of any required regulatory approvals; the ability of the Company to obtain qualified staff, equipment and services in a timely and cost efficient manner; the ability of the operator of the projects which the Company has an interest in to operate the field in a safe, efficient and effective manner; the ability of the Company to obtain financing on acceptable terms; field production rates and decline rates; the ability to replace and expand oil and natural gas reserves through acquisition, development of exploration; the timing and costs of pipeline, storage and facility construction and expansion and the ability of the Company to secure adequate product transportation; future oil and natural gas prices; currency, exchange and interest rates; the regulatory framework regarding royalties, taxes and environmental matters; and the ability of the Company to successfully market its oil and natural gas products. Readers are cautioned that the foregoing list is not exhaustive of all factors and assumptions which have been used.
Forward-looking statements or information are based on current expectations, estimates and projections that involve a number of risks and uncertainties which could cause actual results to differ materially from those anticipated by the Company and described in the forward-looking statements or information. These risks and uncertainties may cause actual results to differ materially from the forward-looking statements or information. The material risk factors affecting the Company and its business are contained in the Company's Annual Information Form which is available on SEDAR at www.sedar.com.
The forward-looking statements or information contained in this press release are made as of the date hereof and the Company undertakes no obligation to update publicly or revise any forward-looking statements or information, whether as a result of new information, future events or otherwise unless required by applicable securities laws. The forward looking statements or information contained in this press release are expressly qualified by this cautionary statement.
BOEs are presented on the basis of one BOE for six Mcf of natural gas. Disclosure provided herein in respect of BOEs 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.
For the first quarter of 2013, the ratio between the average price of West Texas Intermediate ("WTI") crude oil at Cushing and NYMEX natural gas was approximately 26:1 ("Value Ratio"). The Value Ratio is obtained using the first quarter 2013 WTI average price of $94.30 (US$/Bbl) for crude oil and the first quarter 2013 NYMEX average price of $3.48 (US$/MMbtu) for natural gas. This Value Ratio is significantly different from the energy equivalency ratio of 6:1 and using a 6:1 ratio would be misleading as an indication of value.
The TSX has neither approved nor disapproved the contents of this news release.
SOURCE: Cequence Energy Ltd.
For further information:
Paul Wanklyn, Chief Executive Officer, (403) 218-8850, firstname.lastname@example.org
David Gillis, Chief Financial Officer, (403) 806-4041, email@example.com