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Paramount shuts in production Add to ...

Paramount Energy Trust is selectively curtailing some of its natural gas production, arguing that its preferable to save its reserves and wait until prices improve, the trust announced yesterday.

The trust has shut in, or will soon shut-in, about 35 million cubic feet of gas production per day.

Assuming natural gas prices stay in their doldrums until October, total 2009 production is expected to be around 160 million cubic feet a day.

Nevertheless, Paramount confirmed it will make a distribution of five cents per unit for the month of July, to be paid on Aug. 17

Alberta spot natural gas prices closed at $3.17 per 1,000 cubic feet on Tuesday. A year ago, the price was $8.76. Most producers say their break-even range is between $6 and $8, depending on the type of resource and its location.

"Our view is that the market for natural gas is going to recover in the foreseeable future. So we think that's we're just eroding value by selling it at today's prices," Paramount CEO Sue Riddell Rose said.

Paramount (PMT.UN-T)

Close: $4.30, down 13 cents

 

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