Paramount Resources Ltd. (TSX:POU)
OPERATIONAL UPDATE
Oil and Gas Operations
-- Sales volumes in the third quarter were impacted by scheduled and
unscheduled third party downstream NGLs processing disruptions, which
shut-in up to 6,000 Boe/d of Paramount's production. The Company was
able to partially restore sales volumes to approximately 20,000 Boe/d by
the end of October after the affected third party NGLs facility resumed
service. Paramount's production continues to be impacted by the
availability of downstream NGLs fractionation capacity as third party
operators prorate available NGLs processing capacity.
-- Operating expenses decreased to $8.50 per Boe in the third quarter of
2012 from $9.88 per Boe in 2011 due to the cost savings from the
Company's 45 MMcf/d Musreau refrigeration facility (the "Musreau Refrig
Facility") and the sale of higher cost US properties.
-- Paramount received regulatory approval in July 2012 for the 200 MMcf/d
Musreau deep cut facility. Site preparation work commenced in the third
quarter of 2012, construction work is continuing to progress, and
equipment deliveries are expected to begin before the end of the year.
-- Advance drilling for the deep cut facility expansions at Musreau and
Smoky continued. The Company currently has an inventory of 31 (24 net)
wells with estimated first month deliverability exceeding 200 MMcf/d
(150 MMcf/d net) of raw gas.
-- Paramount has completed drilling and fracture stimulation operations at
its first five-well pad at Musreau, where three (2.5 net) Montney
formation wells and two (1.5 net) Falher formation wells were drilled
and completed for an aggregate gross cost of approximately $37 million.
Average gross raw gas test rates for the five wells aggregated to
approximately 55 MMcf/d over the final 24 hours of their test periods,
with flowing pressures averaging 2,500 PSI.
Strategic Investments
-- The Company has commenced drilling its second exploratory vertical
evaluation well on its Liard Basin Besa River shale gas lands.
-- Construction of Paramount's two new walking drilling rigs is nearing
completion with the first rig scheduled to commence drilling for the
Kaybob COU in December and the second expected to commence drilling in
January 2013.
Corporate
-- Paramount raised an aggregate $125.1 million through the issuance of a
total of 4.2 million flow-through Common Shares in late-September and
early-October.
-- Paramount is continuing to work on a proposal from one of its lenders
for an expansion of the Company's bank credit facility and, as a result,
the revolving period and maturity date of the existing $300 million bank
credit facility (the "Existing Facility") have been extended to November
15, 2012 and November 15, 2013, respectively. Paramount expects that the
revolving period and maturity date of the Existing Facility would be
further extended if such facility is not expanded before November 15,
2012.
-- A $6.2 million settlement was received in the third quarter in respect
of a business interruption insurance claim related to an electrical
equipment failure at the Musreau Refrig Facility in the fourth quarter
of 2011.
----------------------------------------------------------------------------
Financial and Operating Highlights(1,2)
----------------------------------------------------------------------------
($ millions, except as noted)
---------------------------------------------------------------------------
Three months ended Nine months ended
September 30 September 30
% %
2012 2011 Change 2012 2011 Change
----------------------------------------------------------------------------
Financial
Petroleum and natural
gas sales 41.3 70.5 (41) 142.5 178.4 (20)
Funds flow from
operations 15.5 32.8 (53) 40.4 70.2 (42)
Per share - diluted
($/share) 0.18 0.42 (57) 0.46 0.91 (49)
Net income (loss) (34.6) (22.4) (54) 89.9 (22.1) 507
Per share - basic
($/share) (0.40) (0.28) (43) 1.05 (0.29) 462
Per share - diluted
($/share) (0.40) (0.28) (43) 1.03 (0.29) 455
Exploration and
development
expenditures 147.7 107.0 38 356.3 321.7 11
Investments in other
entities - market
value(3) 656.6 812.3 (19)
Total assets 1,903.0 1,737.9 9
Net debt(4) 569.1 589.6 (3)
Common shares
outstanding (thousands) 87,489 79,002 11
Operating
Sales volumes
Natural gas (MMcf/d) 95.3 97.8 (3) 96.7 78.2 24
NGLs (Bbl/d) 1,755 2,062 (15) 1,793 1,515 18
Oil (Bbl/d) 1,081 2,344 (54) 1,756 2,269 (23)
Total (Boe/d) 18,712 20,707 (10) 19,663 16,820 17
Average realized price
Natural gas ($/Mcf) 2.58 4.12 (37) 2.46 4.20 (41)
NGLs ($/Bbl) 60.65 80.82 (25) 69.42 80.09 (13)
Oil ($/Bbl) 81.28 79.42 2 83.96 84.81 (1)
Total ($/Boe) 24.00 37.03 (35) 26.46 38.85 (32)
Net wells drilled
(excluding oil sands
evaluation) 9 15 (40) 28 35 (20)
Net oil sands evaluation
wells drilled - - - 1 27 (96)
----------------------------------------------------------------------------
(1) Readers are referred to the advisories concerning non-GAAP measures and
oil and gas definitions in the "Advisories" section of this document.
(2) Amounts include the results of discontinued operations. Refer to pages 6
and 7 of Paramount's Management's Discussion and Analysis for the three
and nine months ended September 30, 2012.
(3) Based on the period-end closing prices of publicly traded enterprises
and the book value of the remaining investments.
(4) Net debt is a non-GAAP measure, it is calculated and defined in the
Liquidity and Capital Resources section of Paramount's Management's
Discussion and Analysis for the three and nine months ended September
30, 2012.
----------------------------------------------------------------------------
REVIEW OF OPERATIONS
----------------------------------------------------------------------------
Third Quarter Second Quarter
2012 2012(1) % Change
----------------------------------------------------------------------------
Sales volumes
Natural gas (MMcf/d) 95.3 106.2 (10)
NGLs (Bbl/d) 1,755 1,973 (11)
Oil (Bbl/d) 1,081 1,808 (40)
------------------------------------
Total (Boe/d) 18,712 21,474 (13)
------------------------------------
Netbacks ($ millions) % Change
($/Boe)(2) ($/Boe)(2) in $/Boe
Natural gas revenue 22.6 2.58 20.3 2.09 23
NGLs revenue 9.8 60.65 12.5 69.63 (13)
Oil revenue 8.1 81.28 12.8 78.65 3
Royalty and sulphur revenue 0.8 - 0.9 - -
------------------------------------
Petroleum and natural gas
sales 41.3 24.00 46.5 23.82 1
Royalties (2.8) (1.62) (3.9) (2.00) (19)
Operating expense and
production tax (14.6) (8.50) (15.9) (8.20) 4
Transportation (4.9) (2.85) (5.7) (2.90) (2)
------------------------------------
Netback 19.0 11.03 21.0 10.72 3
Financial commodity
contract settlements 0.2 0.10 0.4 0.23 (57)
------------------------------------
Netback including financial
commodity contract
settlements 19.2 11.13 21.4 10.95 2
----------------------------------------------------------------------------
----------------------------------------------------------------------------
(1) Amounts include the results of discontinued operations. Refer to pages 6
and 7 of Paramount's Management's Discussion and Analysis for the three
and nine months ended September 30, 2012.
(2) Natural gas revenue shown per Mcf.
During the third quarter Paramount continued to add production as new wells were
brought-on in the Grande Prairie COU and liquids handling processes at the
Musreau Refrig Facility were optimized. Natural gas and NGLs sales volumes
decreased compared to the second quarter because of scheduled and unscheduled
third party downstream NGLs processing disruptions (the "NGLs Disruption"). The
NGLs Disruption required Paramount to restrict NGLs recovery rates and curtail
production in the Kaybob and Grande Prairie COUs. As a result, the Company's
sales volumes were reduced by up to 6,000 Boe/d between mid-August and
mid-October.
By the end of October, the Company was able to partially restore sales volumes
to approximately 20,000 Boe/d after the affected third party NGLs facility
resumed service. Paramount's production continues to be impacted by the
availability of downstream NGLs fractionation capacity as third party operators
prorate available NGLs processing capacity.
Petroleum and natural gas sales revenue decreased by $5.2 million quarter over
quarter primarily due to lower sales volumes and lower realized NGLs prices,
partially offset by higher realized natural gas and oil prices. Operating costs
per Boe increased four percent compared to the second quarter, primarily due to
third quarter scheduled maintenance work and the impact of lower sales volumes
over the fixed portion of operating expenses.
----------------------------------------------------------------------------
Kaybob
----------------------------------------------------------------------------
Third Quarter Second Quarter
2012 2012 % Change
----------------------------------------------------------------------------
Sales Volumes
Natural gas (MMcf/d) 56.0 66.3 (16)
NGLs (Bbl/d) 843 1,132 (26)
Oil (Bbl/d) 55 61 (10)
------------------------------------
Total (Boe/d) 10,225 12,236 (16)
------------------------------------
Exploration and Development
Expenditures ($ millions)
Exploration, drilling,
completions and tie-ins 70.8 16.9 319
Facilities and gathering 37.7 23.0 64
------------------------------------
108.5 39.9 172
------------------------------------
Gross Net Gross Net
------------------------------------
Wells Drilled 7 5.7 7 4.7
----------------------------------------------------------------------------
----------------------------------------------------------------------------
Sales volumes in the Kaybob COU averaged approximately 11,500 Boe/d through July
and August. As a result of the NGLs Disruption, production across the Kaybob COU
was curtailed to less than 6,500 Boe/d by the middle of September, including
temporarily reducing throughput at the Musreau Refrig Facility to 10 MMcf/d.
Following the resolution of the NGLs Disruption in mid-October, Kaybob COU sales
volumes have once again increased to over 11,000 Boe/d.
The Kaybob COU's third quarter operating costs were approximately $5.00 per Boe,
before accounting for the impact of third party processing income. The Musreau
Refrig Facility provides significant savings to the Company through the
elimination of third party processing fees. In the third quarter, Paramount
received a $6.2 million settlement in respect of a business interruption
insurance claim related to an electrical equipment failure at the Musreau Refrig
Facility in the fourth quarter of 2011.
Paramount has completed drilling and fracture stimulation operations at its
first five-well pad at Musreau, where three (2.5 net) Montney formation wells
and two (1.5 net) Falher formation wells were drilled and completed for an
aggregate gross cost of approximately $37 million. Average gross raw gas test
rates for the five wells aggregated to approximately 55 MMcf/d over the final 24
hours of their test periods, with flowing pressures averaging 2,500 PSI. The
efficiencies gained from concentrating activities at a single pad location have
reduced per well capital costs and will result in lower operating expenses. The
Company plans to continue to utilize multi-well pad sites to realize these cost
savings.
Construction activities have commenced at the 200 MMcf/d deep cut facility at
Musreau (the "Musreau Deep Cut Facility"). Foundation work is underway and
equipment deliveries are scheduled to commence by the end of the year. The
Company has incurred approximately $70 million of costs related to the Musreau
Deep Cut Facility to September 30, 2012 and anticipates spending an additional
$50 million during the remainder of 2012. The facility is expected to be
commissioned in the second half of 2013 at an estimated total cost of
approximately $180 million.
Paramount has initiated a project to construct an amine processing train at the
Musreau Deep Cut Facility, which will provide the capability to treat sour gas
production at the plant instead of at well sites. This enhancement is expected
to reduce ongoing operating costs and decrease equipping costs by over $1
million per well. The Company is currently finalizing the design of the amine
train, which is expected to cost approximately $50 million, and the procurement
of long lead-time components has commenced for a planned start-up in the first
half of 2014. The addition of the amine train will not delay commissioning of
the Musreau Deep Cut Facility.
Paramount is also participating in the expansion of a non-operated processing
facility at Smoky (the "Smoky Deep Cut Facility"), which is being upgraded to
operate as a deep cut liquids extraction plant. The Company will have a 20
percent interest in the expanded facility, up from its 10 percent share of the
existing 100 MMcf/d dew point facility. The Smoky Deep Cut Facility will
initially have 200 MMcf/d of raw gas capacity upon start-up, increasing to 300
MMcf/d through the later installation of an incremental 100 MMcf/d of
compression. As a plant owner, Paramount has the option at any time to request
the installation of the additional compression, which would bring the Company's
total owned capacity in the plant to 60 MMcf/d. Construction work commenced at
the site in the third quarter with the installation of pilings and foundations
and major equipment is being manufactured. The expansion is scheduled to be
commissioned in the first half of 2014.
Paramount has entered into a long-term firm-service agreement with a midstream
company to de-ethanize and fractionate Kaybob area NGLs volumes. The midstream
company has undertaken to expand its facilities to process Paramount's NGLs
streams, which will secure NGLs processing for the volumes that will be produced
from the Kaybob area deep cut facilities. Paramount has also entered into an
agreement in principle with a petro-chemical producer on long-term arrangements
for the sale of the Company's ethane production and is negotiating long-term
arrangements for the transportation of its Kaybob area natural gas and NGLs
volumes.
During the third quarter, the Kaybob COU drilled five (3.7 net) horizontal
Falher formation wells, one (1.0 net) horizontal Montney well and one (1.0 net)
horizontal Wilrich well. Twelve (9.3 net) wells were fracture stimulated
including one (1.0 net) Montney formation well. Test results have been
consistent with expectations, further confirming the Company's well performance
profiles.
Paramount's experience over the past few years in the Deep Basin has enabled the
Company to refine its development programs and reduce the cost of new wells by
improving drilling techniques, using more cost effective fracture stimulations
and improving logistics with multi-well pad sites. Drilling days for the latest
four Falher wells have been reduced to less than 25 days compared to 45 or more
days for wells drilled in 2010. The latest two Montney wells were drilled in 45
and 41 days compared to an average of over 80 days for three similar wells
drilled in 2011. Paramount has also been able to negotiate lower rates for
services, equipment and completion fluids.
The following table summarizes the current status of Kaybob Deep Basin wells
that have been drilled and are awaiting production, the estimated remaining
capital required to complete these wells, and their anticipated production and
sales volumes:
Total
Remaining Estimated Estimated
Capital Net Raw Gas Net Sales
Wells (net) Production(1) Volumes(2)
--------------------------------------------------------------
First First First First
Month Year Month Year
-------------------------------------------------
Gross Net ($ millions) (MMcf/d) (MMcf/d) (Boe/d) (Boe/d)
Shut-in due to
capacity
contraints 4 4 1 13 6 4,100 2,100
Tied-in,
capable of
producing 6 3 - 20 9 5,500 2,500
Completed,
awaiting tie-
in 12 10 11 66 32 20,000 10,000
Drilled,
awaiting
completion 9 7 29 52 22 14,100 6,100
----------------------------------------------------------------------------
31 24 41 151 69 43,700 20,700
----------------------------------------------------------------------------
(1) Based on the Company's 4.9 Bcf type curve for Falher wells and 3.7 Bcf
type curve for Montney wells.
(2) Based on processing through a deep cut facility.
The Company plans to drill up to an additional six wells for the remainder of
2012, with more wells to be drilled in 2013 to continue building behind pipe
production in advance of completing the plant expansions at Musreau and Smoky.
----------------------------------------------------------------------------
Grande Prairie
----------------------------------------------------------------------------
Third Quarter Second Quarter
2012 2012 % Change
----------------------------------------------------------------------------
Sales Volumes
Natural gas (MMcf/d) 21.6 21.5 -
NGLs (Bbl/d) 733 658 11
Oil (Bbl/d) 251 269 (7)
------------------------------------
Total (Boe/d) 4,587 4,514 2
------------------------------------
Exploration and Development
Expenditures ($ millions)
Exploration, drilling,
completions and tie-ins 15.1 12.3 23
Facilities and gathering 9.9 6.5 52
------------------------------------
25.0 18.8 33
------------------------------------
Gross Net Gross Net
------------------------------------
Wells Drilled - - 3 2.1
----------------------------------------------------------------------------
----------------------------------------------------------------------------
Average sales volumes in the Grande Prairie COU exceeded 6,000 Boe/d for two
weeks in August as wells completed in the first half of the year were brought-on
at Valhalla and Karr-Gold Creek. As a result of the NGLs Disruption, production
at Valhalla that had been processed through a third party deep cut facility was
diverted to a dew point facility in order to reduce the volume of NGLs extracted
from the gas stream during processing. Paramount is limited to 10 MMcf/d of
capacity at the dew point facility, which has resulted in approximately 8 MMcf/d
of natural gas production being shut-in at Valhalla. The Company is maintaining
sales volumes in the Grande Prairie COU between 4,000 and 4,500 Boe/d due to
ongoing NGLs capacity limitations. Production will be increased as additional
NGLs processing capacity becomes available.
---------------------------------------------------------------------------
Southern
---------------------------------------------------------------------------
Third Quarter Second Quarter(1)
2012 2012 % Change
----------------------------------------------------------------------------
Sales Volumes
Natural gas (MMcf/d) 9.2 9.8 (6)
NGLs (Bbl/d) 148 169 (12)
Oil (Bbl/d) 594 1,250 (52)
------------------------------------
Total (Boe/d) 2,270 3,059 (26)
------------------------------------
Exploration and Development
Expenditures ($ millions)
Exploration, drilling,
completions and tie-ins 6.4 1.9 237
Facilities and gathering 0.3 0.7 (57)
------------------------------------
6.7 2.6 158
------------------------------------
Gross Net Gross Net
------------------------------------
Wells Drilled 2 2.0 - -
----------------------------------------------------------------------------
----------------------------------------------------------------------------
(1) Amounts include the results of discontinued operations. Refer to pages 6
and 7 of Paramount's Management's Discussion and Analysis for the three
and nine months ended September 30, 2012.
Third quarter sales volumes in the Southern COU decreased mainly because of the
May 2012 United States property disposition. Production volumes were also
impacted by a compression equipment failure at Chain and a turnaround at a third
party downstream facility in Ricinus - Harmattan.
In the third quarter the Southern COU drilled two (2.0 net) liquids-rich natural
gas wells in Harmattan.
---------------------------------------------------------------------------
Northern
---------------------------------------------------------------------------
Third Quarter Second Quarter
2012 2012 % Change
----------------------------------------------------------------------------
Sales Volumes
Natural gas (MMcf/d) 8.5 8.6 (1)
NGLs (Bbl/d) 31 14 121
Oil (Bbl/d) 181 228 (21)
------------------------------------
Total (Boe/d) 1,630 1,665 (2)
------------------------------------
Exploration and Development
Expenditures ($ millions)
Exploration, drilling,
completions and tie-ins 2.0 0.6 233
Facilities and gathering 1.6 1.9 (16)
------------------------------------
3.6 2.5 44
------------------------------------
Gross Net Gross Net
------------------------------------
Wells Drilled 1 1.0 - -
----------------------------------------------------------------------------
----------------------------------------------------------------------------
Third quarter sales volumes in the Northern COU were impacted by a forest fire
near the Company's processing facility at Bistcho which shut-in approximately
1,250 Boe/d of production for 15 days in July.
In Northeast British Columbia, modifications are being completed to surface
facilities for the Company's initial well at Birch to be re-started later in
November. Three Birch wells drilled to date have targeted the upper Montney
formation. In the third quarter, Paramount drilled a vertical evaluation well
into the lower Montney formation at Birch. The well will be completed and,
depending on test results, the Company will have the option of drilling and
completing a horizontal leg in the lower or upper Montney formation.
STRATEGIC INVESTMENTS
In November 2012, Cavalier Energy Inc. ("Cavalier Energy") plans to submit a
regulatory application for the first phase of development at the Hoole property,
a 10,000 Bbl/d project targeting the Grand Rapids formation using proven SAGD
technologies. Cavalier Energy believes that first steam could commence as early
as the second half of 2015. Longer-term plans for Hoole include three additional
30,000 Bbl/d phases that would increase production to 100,000 Bbl/d by 2024.
SHALE GAS
Paramount's Besa River shale gas holdings are focused in the Liard Basin in
Northeast British Columbia and the Northwest Territories. The Company began
drilling its second Liard Basin shale gas evaluation well at Patry in October.
The well is expected to be drilled to a vertical depth of 3,500 meters and will
be cored and logged for evaluation. In early 2013 Paramount plans to finish
drilling its initial shale gas evaluation well at Dunedin after drilling was
suspended in the spring of 2012 due to warm weather. Paramount's exploratory
drilling activities are expected to extend the mineral rights surrounding the
well locations for an additional decade and provide information to be used for
future development.
CORPORATE
Paramount is continuing to work on a proposal from one of its lenders for an
expansion of the Company's bank credit facility and, as a result, the revolving
period and maturity date of the Existing Facility have been extended to November
15, 2012 and November 15, 2013, respectively. Paramount expects that the
revolving period and maturity date of the Existing Facility would be further
extended if such facility is not expanded before November 15, 2012.
Paramount raised an aggregate $125.1 million through the issuance of a total of
4.2 million flow-through Common Shares in late-September and early-October.
OUTLOOK
Year-to-date exploration and development expenditures total approximately $360
million. Planned spending for the remainder of the year will be focused on the
Kaybob deep cut projects, where $65 million will be invested in the Musreau and
Smoky deep cut facilities and drilling will continue to build the inventory of
wells to feed the expansions. Strategic Investment spending for the remainder of
the year will be directed to completing the construction of the new walking
drilling rigs and drilling the Company's second Liard Basin shale gas evaluation
well. The Company has flexibility within its current capital plan to increase or
decrease spending depending on future economic conditions, among other factors.
Between August and October, Paramount's sales volumes were constrained by up to
6,000 Boe/d due to the NGLs Disruption. By the end of October, the Company was
able to partially restore sales volumes to approximately 20,000 Boe/d after the
affected third party NGLs facility resumed service. Paramount's production
continues to be impacted by the availability of downstream NGLs fractionation
capacity as third party operators prorate available NGLs processing capacity.
The Company's 2012 exit rate will depend on the extent to which downstream third
party NGLs processing capacity becomes available. Behind pipe volumes in the
Kaybob and Grande Prairie COUs will be brought-on once the Company is able to
access additional fractionation capacity.
Paramount's long-term firm-service agreement with a midstream company secures
processing capacity for NGLs that will be produced from the Kaybob area deep cut
facilities. Sales volumes are expected to more than double once the Musreau Deep
Cut Facility and the Smoky Deep Cut Facility are operational.
ADDITIONAL INFORMATION
A copy of Paramount's complete results for the three and nine months ended
September 30, 2012, including Management's Discussion and Analysis and the
unaudited Interim Condensed Consolidated Financial Statements for the three and
nine months ended September 30, 2012 can be found at
http://media3.marketwire.com/docs/1106pou.pdf. This information will also be
made available through Paramount's website at www.paramountres.com and SEDAR at
www.sedar.com.
ABOUT PARAMOUNT
Paramount Resources Ltd. is a Canadian oil and natural gas exploration,
development and production company with operations focused in Western Canada.
Paramount's common shares are listed on the Toronto Stock Exchange under the
symbol "POU".
ADVISORIES
FORWARD-LOOKING INFORMATION
Certain statements in this document constitute forward-looking information under
applicable securities legislation. Forward-looking information typically
contains statements with words such as "anticipate", "believe", "estimate",
"expect", "plan", "intend", "propose", or similar words suggesting future
outcomes or an outlook. Forward looking information in this document includes,
but is not limited to:
-- expected production and sales volumes and the timing thereof;
-- operating and other costs;
-- the negotiation and completion of arrangements for the transportation
and sales of natural gas and NGLs;
-- exploration, development and strategic investment plans and strategies
and the anticipated costs, timing and results thereof;
-- budget allocations and capital spending flexibility;
-- planned drilling programs, well completions, well tie-ins and the
anticipated costs and timing thereof;
-- the availability of facilities to process and transport natural gas and
NGLs production;
-- the anticipated costs, scope and timing of proposed new facilities and
facilities' expansions, the expected capacity and utilization of such
facilities and expected sources of funding for such facilities;
-- the timing and scope of Cavalier Energy's planned development of its oil
sands and carbonate bitumen assets and Paramount's development of its
shale gas assets;
-- the anticipated costs and completion date of the two new triple-sized
walking drilling rigs;
-- business strategies and objectives;
-- sources of and plans for funding Paramount's exploration, development,
facilities and other expenditures;
-- the extension of the Existing Facility and the outcome of discussions
regarding an expansion thereof;
-- acquisition and disposition plans;
-- regulatory applications and the anticipated scope, timing and results
thereof;
-- future taxes payable or owing; and
-- the outcome and timing of any legal claims, audits, assessments or other
regulatory matters or proceedings.
Such forward-looking information is based on a number of assumptions which may
prove to be incorrect. The following assumptions have been made, in addition to
any other assumptions identified in this document:
-- future crude oil, bitumen, natural gas and NGLs prices and general
economic, business and market conditions;
-- the ability of Paramount to obtain required capital to finance its
exploration and development activities and its new and expanded
facilities;
-- the ability of Paramount to obtain equipment, services, supplies and
personnel in a timely manner and at an acceptable cost to carry out its
activities;
-- the ability of Paramount to market its oil, natural gas and NGLs
successfully to current and new customers;
-- the ability of Paramount to secure adequate product processing,
transportation and storage;
-- the ability of Paramount and its industry partners to obtain drilling
success and production levels consistent with expectations, including
with respect to anticipated reserves additions and NGLs yields;
-- the timely receipt of required regulatory approvals;
-- expected timelines and budgets being met in respect of facilities
development and construction projects;
-- access to capital markets and other sources of funding for Paramount's
operations and planned expenditures;
-- anticipated rates of return from existing and planned projects relative
to other opportunities;
-- estimates of input and labour costs; and
-- currency exchange and interest rates.
Although Paramount believes that the expectations reflected in such forward
looking information is reasonable, undue reliance should not be placed on it as
Paramount can give no assurance that such expectations will prove to be correct.
Forward-looking information is 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 Paramount and
described in the forward looking information. These risks and uncertainties
include, but are not limited to:
-- fluctuations in crude oil, bitumen, natural gas and NGLs prices, foreign
currency exchange rates and interest rates;
-- the uncertainty of estimates and projections relating to future revenue,
future production, NGLs yields, costs and expenses and the timing
thereof;
-- the ability to secure adequate product processing, transportation and
storage;
-- the uncertainty of exploration, development and drilling activities;
-- operational risks in exploring for, developing and producing crude oil,
bitumen, natural gas, and NGLs, and the timing thereof;
-- the ability to obtain equipment, services, supplies and personnel in a
timely manner and at an acceptable cost;
-- potential disruptions or unexpected technical difficulties in designing,
developing or operating new, expanded or existing facilities including
third party facilities;
-- risks and uncertainties related to the geology of oil and gas deposits;
-- the uncertainty of reserves and resource estimates;
-- the ability to generate sufficient cash flow from operations and obtain
other sources of financing at an acceptable cost to fund planned
exploration, development and operational activities and meet current and
future obligations, including costs of anticipated new and expanded
facilities and other projects;
-- changes to, or in the interpretation of, applicable laws, regulations or
policies;
-- changes in environmental laws including emission reduction obligations;
-- the receipt, timing, and scope of governmental or regulatory approvals;
-- changes in economic, business and market conditions;
-- the uncertainty regarding aboriginal claims and co-existing with local
populations and stakeholders;
-- the effects of weather;
-- the timing and cost of future abandonment and reclamation activities;
-- clean-up costs or business interruptions resulting from environmental
damage and contamination;
-- the ability to enter into or continue leases;
-- existing and potential lawsuits and regulatory actions;
-- future taxes payable; and
-- other risks and uncertainties described elsewhere in this document and
in Paramount's other filings with Canadian securities authorities,
including its Annual Information Form.
The foregoing list of risks is not exhaustive. Additional information concerning
these and other factors which could impact Paramount are included in Paramount's
most recent Annual Information Form. The forward-looking information contained
in this document is made as of the date hereof and, except as required by
applicable securities law, Paramount 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.
NON-GAAP MEASURES
In this document "Funds flow from operations", "Funds flow from operations - per
Boe", "Funds flow from operations per share - diluted", "Netback", "Netback
including financial commodity contract settlements", "Net Debt", "Exploration
and development expenditures" and "Investments in other entities - market
value", collectively the "Non-GAAP measures", are used and do not have any
standardized meanings as prescribed by Generally Accepted Accounting Principles
in Canada ("GAAP").
Funds flow from operations refers to cash from operating activities before net
changes in operating non-cash working capital, geological and geophysical
expenses and asset retirement obligation settlements. Funds flow from operations
is commonly used in the oil and gas industry to assist management and investors
in measuring the Company's ability to fund capital programs and meet financial
obligations. Netback equals petroleum and natural gas sales less royalties,
operating costs, production taxes and transportation costs. Netback is commonly
used by management and investors to compare the results of the Company's oil and
gas operations between periods. Net Debt is a measure of the Company's overall
debt position after adjusting for certain working capital amounts and is used by
management to assess the Company's overall leverage position. Refer to the
calculation of Net Debt in the liquidity and capital resources section of
Management's Discussion and Analysis. Exploration and development expenditures
refer to capital expenditures and geological and geophysical costs incurred by
the Company's COUs (excluding land and acquisitions). The exploration and
development expenditure measure provides management and investors with
information regarding the Company's Principal Property spending on drilling and
infrastructure projects, separate from land acquisition activity. Investments in
other entities - market value reflects the Company's investments in enterprises
whose securities trade on a public stock exchange at their period end closing
price (e.g. Trilogy, MEG Energy, MGM Energy and others), and investments in all
other entities at book value. Paramount provides this information because the
market values of equity-accounted investments, which are significant assets of
the Company, are often materially different than their carrying values.
Non-GAAP measures should not be considered in isolation or construed as
alternatives to their most directly comparable measure calculated in accordance
with GAAP, or other measures of financial performance calculated in accordance
with GAAP. The Non-GAAP measures are unlikely to be comparable to similar
measures presented by other issuers.
OIL AND GAS MEASURES AND DEFINITIONS
This document contains disclosures expressed as "Boe" and "Boe/d". 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 applicable at the burner tip and does
not represent a value equivalency at the well head. The term "liquids" is used
to represent oil and natural gas liquids.
During the third quarter of 2012, the value ratio between crude oil and natural
gas was approximately 32:1. This value ratio is significantly different from the
energy equivalency ratio of 6:1. Using a 6:1 ratio would be misleading as an
indication of value.
TEST RESULTS
Test rates disclosed in this document represent the average rate of gas-flow
during post clean-up production tests up 4 1/2" casing. All wells were
stimulated using frac oil and substantially all fluids recovered during the test
periods were load fluids. As a result, recovered fluid volumes for the duration
of the tests have not been disclosed. Pressure transient analyses and well-test
interpretations have not been carried out for the wells disclosed and as such,
data should be considered to be preliminary until such analysis or
interpretation has been done. Test results are not necessarily indicative of
long-term performance or of ultimate recovery.
FOR FURTHER INFORMATION PLEASE CONTACT:
Paramount Resources Ltd.
J.H.T. (Jim) Riddell
President and Chief Operating Officer
(403) 290-3600
Paramount Resources Ltd.
B.K. (Bernie) Lee
Chief Financial Officer
(403) 290-3600
(403) 262-7994 (FAX)
www.paramountres.com
Paramount Resources (TSX:POU)
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부터 6월(6) 2024 으로 7월(7) 2024
Paramount Resources (TSX:POU)
과거 데이터 주식 차트
부터 7월(7) 2023 으로 7월(7) 2024
