|By Marketwired .||
|December 12, 2012 12:17 AM EST||
CALGARY, ALBERTA -- (Marketwire) -- 12/12/12 -- Delphi Energy Corp. (TSX:DEE) ("Delphi" or the "Company") is pleased to provide the following update.
Delphi has entered into a farm-in agreement to earn up to a 75 percent working interest in 35 sections of Montney and Nordegg petroleum and natural gas ("PNG") rights in its core area of Bigstone, Alberta.
The farm-in contemplates Delphi drilling one vertical test well at Bigstone South, with an option to drill and complete a horizontal well in the Montney formation earning a 75 percent working interest in up to 32.5 gross sections of land containing Nordegg and Montney rights. The test well at Bigstone South is scheduled to commence drilling during the second quarter of 2013.
Delphi will also earn an additional 2.5 sections (1.875 net) of Montney rights at Bigstone East. The Company will farm-in on the Farmor's working interest by drilling four gross wells contemplated to be drilled in 2013 and 2014 as part of the Company's ongoing drilling program. In each of these four wells, Delphi will pay 100 percent of the drill, complete, equip and tie-in costs and retain 100 percent of the Farmor's working interest in each such well subject to a convertible gross overriding royalty payable to the Farmor until payout, after which Delphi will retain an average working interest of 76.25 percent in the wells drilled and lands earned. The recently drilled 15-10-60-23W5M well is the first of the four gross wells planned. The remaining three wells to be drilled also offset the Company's existing Montney production.
The transaction has several key benefits to Delphi:
-- Upon full earning, the Company will grow its land position by nearly 60 percent in the Bigstone Montney play from 41.7 net sections to approximately 66.2 net sections. -- The farm-in nearly doubles the Bigstone East low-risk development drilling inventory in the proven upper and middle Montney formations. -- The southern portion of the land block offers significant exploration upside in the lower Montney and the Nordegg formation for liquids-rich natural gas. -- Delphi's capital commitments are manageable and scheduled over an extended period of time, however, Delphi is positioned to accelerate the earning phase of this agreement should funding be available.
At Bigstone East, Delphi has completed the drilling of its fourth Montney horizontal well 15-10-60-23 W5M with a surface location at 16-03-60-23 W5M. The well has reached its planned total measured depth of 4,455 metres resulting in a horizontal section in the Montney formation of 1,424 metres, ahead of schedule and at lower costs. Completion operations consisting of a multi-stage slick-water hybrid frac program is expected to commence early in January. The drilling rig is expected to move to its next location and commence drilling after the Christmas break.
The Company's first three Montney wells continue to meet expectations for overall production rates and exceed expectations for NGL yields resulting in robust field netbacks. Field recovered condensate and shallow cut NGL yields continue to average above 60 bbls/mmcf (53 percent field and plant recovered condensate). The Company continues to optimize its drilling and completions practices to both reduce costs and increase production rates. Successful consolidation of available undeveloped land in the immediate area into a contiguous block is also contributing to increased capital efficiencies for optimized well spacing while minimizing capital requirements for infrastructure.
At Wapiti, the Company has recently completed two liquids-rich natural gas wells (100 percent Delphi) in early cretaceous aged formations. Both wells were drilled in the first quarter of 2012. The two wells are expected to be brought on production within the next week through the Company's existing infrastructure and deep-cut processing facility.
The Company has increased its natural gas hedge position to approximately 42 percent of its natural gas production at $3.12 per mcf for the period of January 1, 2013 to June 30, 2013. For all of 2013, Delphi has approximately 39 percent of its natural gas production hedged at $3.22 per mcf. Currently, the Company has the following natural gas hedges over the next several years.
---------------------------------------------------------------------------- H1 2013 H2 2013 2014 Q1 2015 ---------------------------------------------------------------------------- Volume (mcf/d) 15.0 13.4 8.5 2.8 ---------------------------------------------------------------------------- Percent Hedged (%) (i) 42 37 24 8 ---------------------------------------------------------------------------- Hedge Price (Cdn $/mcf) 3.12 3.33 3.27 3.73 ---------------------------------------------------------------------------- (i) Based on production of 36,000 mcf/d
The Company expects net capital spending for 2012 to be between $48.0 and $50.0 million with production for 2012 to average approximately 8,300 boe/d. Net debt at year end is expected to be between $90.0 and $92.0 million.
For 2013, Delphi is providing guidance for the first half of the year at this time due to the uncertainty of natural gas prices. Winter weather or lack thereof in central Canada and, in particular, the northeast region of the United States will have a direct impact on the outlook for natural gas prices in 2013.
For the first half of 2013, Delphi expects AECO natural gas prices to average approximately Cdn. $3.30 per mcf and Edmonton light oil prices to average Cdn $88.00 per barrel. Production is forecast to average between 7,900 to 8,300 boe/d (76 percent natural gas) during the first half of 2013.
The capital program will consist primarily of drilling two additional Bigstone East Montney horizontal wells, resulting in three as part of the winter capital program. Including completion operations of the well drilled in December 2012 and maintenance/miscellaneous capital, the first half capital spending plans total between $29.0 and $33.0 million. The capital program is expected to be funded by forecasted cash flow of approximately $16.0 to $18.0 million and the equity financing in the fourth quarter of 2012 resulting in a net debt estimate at the end of the first half of 2013 of approximately $104.0 to $108.0 million.
Delphi Energy is a Calgary-based company that explores, develops and produces oil and natural gas in Western Canada. The Company is managed by a proven technical team. Delphi trades on the Toronto Stock Exchange under the symbol DEE.
Forward-Looking Statements. This management discussion and analysis contains forward-looking statements and forward-looking information within the meaning of applicable securities laws. The use of any of the words "expect", "anticipate", "continue", "estimate", may", "will", "should", believe", "intends", "forecast", "plans", "guidance" and similar expressions are intended to identify forward-looking statements or information.
More particularly and without limitation, this management discussion and analysis contains forward looking statements and information relating to the Company's risk management program, petroleum and natural gas production, future funds from operations, capital programs, commodity prices, costs and debt levels. The forward-looking statements and information are based on certain key expectations and assumptions made by Delphi, including expectations and assumptions relating to prevailing commodity prices and exchange rates, applicable royalty rates and tax laws, future well production rates, the performance of existing wells, the success of drilling new wells, the capital availability to undertake planned activities and the availability and cost of labour and services.
Although the Company believes that the expectations reflected in such forward-looking statements and information are reasonable, it can give no assurance that such expectations will prove to be correct. Since forward-looking statements and information address future events and conditions, by their very nature they involve inherent risks and uncertainties. Actual results may differ materially from those currently anticipated due to a number of factors and risks. These include, but are not limited to, the risks associated with the oil and gas industry in general such as operational risks in development, exploration and production, delays or changes in plans with respect to exploration or development projects or capital expenditures, the uncertainty of estimates and projections relating to production rates, costs and expenses, commodity price and exchange rate fluctuations, marketing and transportation, environmental risks, competition, the ability to access sufficient capital from internal and external sources and changes in tax, royalty and environmental legislation. Additional information on these and other factors that could affect the Company's operations or financial results are included in reports on file with the applicable securities regulatory authorities and may be accessed through the SEDAR website (www.sedar.com). The forward-looking statements and information contained in this press release are made as of the date hereof for the purpose of providing the readers with the Company's expectations for the coming year. The forward-looking statements and information may not be appropriate for other purposes. Delphi 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 so required by applicable securities laws.
Basis of Presentation. For the purpose of reporting production information, reserves and calculating unit prices and costs, natural gas volumes have been converted to a barrel of oil equivalent (boe) using six thousand cubic feet equal to one barrel. A boe conversion ratio of 6:1 is based upon an energy equivalency conversion method primarily applicable at the burner tip and does not represent a value equivalency at the wellhead. This conversion conforms with the Canadian Securities Administrators' National Instrument 51-101 when boes are disclosed. Boes may be misleading, particularly if used in isolation.
As per CSA Staff Notice 51-327 initial production rates should be considered preliminary data and such data is not necessarily indicative of long-term performance or of ultimate recovery.
Non-IFRS Measures. The release contains the terms "funds from operations", "funds from operations per share", "net debt", "cash operating costs" and "netbacks" which are not recognized measures under IFRS. The Company uses these measures to help evaluate its performance. Management considers netbacks an important measure as it demonstrates its profitability relative to current commodity prices. Management uses funds from operations to analyze performance and considers it a key measure as it demonstrates the Company's ability to generate the cash necessary to fund future capital investments and to repay debt. Funds from operations is a non-IFRS measure and has been defined by the Company as net earnings plus the add back of non-cash items (depletion and depletion, accretion, stock-based compensation, deferred income taxes and unrealized gain/(loss) on financial instruments) and excludes the change in non-cash working capital related to operating activities and expenditures on decommissioning obligations. The Company also presents funds from operations per share whereby amounts per share are calculated using weighted average shares outstanding consistent with the calculation of earnings per share. Delphi's determination of funds from operations may not be comparable to that reported by other companies nor should it be viewed as an alternative to cash flow from operating activities, net earnings or other measures of financial performance calculated in accordance with IFRS. The Company has defined net debt as the sum of long term debt plus/minus working capital excluding the current portion of deferred income taxes and fair value of financial instruments. Net debt is used by management to monitor remaining availability under its credit facilities. Cash operating costs have been defined as the sum of operating expenses, transportation expense, general and administrative expenses and cash finance costs.
SYS-CON Events announced today that LeaseWeb USA, a cloud Infrastructure-as-a-Service (IaaS) provider, will exhibit at the 19th International Cloud Expo, which will take place on November 1–3, 2016, at the Santa Clara Convention Center in Santa Clara, CA. LeaseWeb is one of the world's largest hosting brands. The company helps customers define, develop and deploy IT infrastructure tailored to their exact business needs, by combining various kinds cloud solutions.
Jul. 24, 2016 09:30 AM EDT Reads: 1,054
The best-practices for building IoT applications with Go Code that attendees can use to build their own IoT applications. In his session at @ThingsExpo, Indraneel Mitra, Senior Solutions Architect & Technology Evangelist at Cognizant, provided valuable information and resources for both novice and experienced developers on how to get started with IoT and Golang in a day. He also provided information on how to use Intel Arduino Kit, Go Robotics API and AWS IoT stack to build an application tha...
Jul. 24, 2016 08:45 AM EDT Reads: 876
Whether your IoT service is connecting cars, homes, appliances, wearable, cameras or other devices, one question hangs in the balance – how do you actually make money from this service? The ability to turn your IoT service into profit requires the ability to create a monetization strategy that is flexible, scalable and working for you in real-time. It must be a transparent, smoothly implemented strategy that all stakeholders – from customers to the board – will be able to understand and comprehe...
Jul. 24, 2016 08:30 AM EDT Reads: 2,052
It’s 2016: buildings are smart, connected and the IoT is fundamentally altering how control and operating systems work and speak to each other. Platforms across the enterprise are networked via inexpensive sensors to collect massive amounts of data for analytics, information management, and insights that can be used to continuously improve operations. In his session at @ThingsExpo, Brian Chemel, Co-Founder and CTO of Digital Lumens, will explore: The benefits sensor-networked systems bring to ...
Jul. 24, 2016 08:30 AM EDT Reads: 1,457
Identity is in everything and customers are looking to their providers to ensure the security of their identities, transactions and data. With the increased reliance on cloud-based services, service providers must build security and trust into their offerings, adding value to customers and improving the user experience. Making identity, security and privacy easy for customers provides a unique advantage over the competition.
Jul. 24, 2016 08:15 AM EDT Reads: 1,050
SYS-CON Events announced today that Venafi, the Immune System for the Internet™ and the leading provider of Next Generation Trust Protection, will exhibit at @DevOpsSummit at 19th International Cloud Expo, which will take place on November 1–3, 2016, at the Santa Clara Convention Center in Santa Clara, CA. Venafi is the Immune System for the Internet™ that protects the foundation of all cybersecurity – cryptographic keys and digital certificates – so they can’t be misused by bad guys in attacks...
Jul. 24, 2016 08:15 AM EDT Reads: 1,145
"Tintri was started in 2008 with the express purpose of building a storage appliance that is ideal for virtualized environments. We support a lot of different hypervisor platforms from VMware to OpenStack to Hyper-V," explained Dan Florea, Director of Product Management at Tintri, in this SYS-CON.tv interview at 18th Cloud Expo, held June 7-9, 2016, at the Javits Center in New York City, NY.
Jul. 24, 2016 08:15 AM EDT Reads: 1,812
Is your aging software platform suffering from technical debt while the market changes and demands new solutions at a faster clip? It’s a bold move, but you might consider walking away from your core platform and starting fresh. ReadyTalk did exactly that. In his General Session at 19th Cloud Expo, Michael Chambliss, Head of Engineering at ReadyTalk, will discuss why and how ReadyTalk diverted from healthy revenue and over a decade of audio conferencing product development to start an innovati...
Jul. 24, 2016 08:00 AM EDT Reads: 887
For basic one-to-one voice or video calling solutions, WebRTC has proven to be a very powerful technology. Although WebRTC’s core functionality is to provide secure, real-time p2p media streaming, leveraging native platform features and server-side components brings up new communication capabilities for web and native mobile applications, allowing for advanced multi-user use cases such as video broadcasting, conferencing, and media recording.
Jul. 24, 2016 07:45 AM EDT Reads: 737
Large scale deployments present unique planning challenges, system commissioning hurdles between IT and OT and demand careful system hand-off orchestration. In his session at @ThingsExpo, Jeff Smith, Senior Director and a founding member of Incenergy, will discuss some of the key tactics to ensure delivery success based on his experience of the last two years deploying Industrial IoT systems across four continents.
Jul. 24, 2016 07:00 AM EDT Reads: 1,415
There will be new vendors providing applications, middleware, and connected devices to support the thriving IoT ecosystem. This essentially means that electronic device manufacturers will also be in the software business. Many will be new to building embedded software or robust software. This creates an increased importance on software quality, particularly within the Industrial Internet of Things where business-critical applications are becoming dependent on products controlled by software. Qua...
Jul. 24, 2016 05:30 AM EDT Reads: 1,311
"There's a growing demand from users for things to be faster. When you think about all the transactions or interactions users will have with your product and everything that is between those transactions and interactions - what drives us at Catchpoint Systems is the idea to measure that and to analyze it," explained Leo Vasiliou, Director of Web Performance Engineering at Catchpoint Systems, in this SYS-CON.tv interview at 18th Cloud Expo, held June 7-9, 2016, at the Javits Center in New York Ci...
Jul. 24, 2016 04:45 AM EDT Reads: 1,875
SYS-CON Events has announced today that Roger Strukhoff has been named conference chair of Cloud Expo and @ThingsExpo 2016 Silicon Valley. The 19th Cloud Expo and 6th @ThingsExpo will take place on November 1-3, 2016, at the Santa Clara Convention Center in Santa Clara, CA. "The Internet of Things brings trillions of dollars of opportunity to developers and enterprise IT, no matter how you measure it," stated Roger Strukhoff. "More importantly, it leverages the power of devices and the Interne...
Jul. 24, 2016 04:45 AM EDT Reads: 1,976
The Internet of Things will challenge the status quo of how IT and development organizations operate. Or will it? Certainly the fog layer of IoT requires special insights about data ontology, security and transactional integrity. But the developmental challenges are the same: People, Process and Platform. In his session at @ThingsExpo, Craig Sproule, CEO of Metavine, demonstrated how to move beyond today's coding paradigm and shared the must-have mindsets for removing complexity from the develo...
Jul. 24, 2016 01:30 AM EDT Reads: 1,142
The IETF draft standard for M2M certificates is a security solution specifically designed for the demanding needs of IoT/M2M applications. In his session at @ThingsExpo, Brian Romansky, VP of Strategic Technology at TrustPoint Innovation, explained how M2M certificates can efficiently enable confidentiality, integrity, and authenticity on highly constrained devices.
Jul. 24, 2016 01:15 AM EDT Reads: 896
SYS-CON Events announced today that MangoApps will exhibit at the 19th International Cloud Expo, which will take place on November 1–3, 2016, at the Santa Clara Convention Center in Santa Clara, CA. MangoApps provides modern company intranets and team collaboration software, allowing workers to stay connected and productive from anywhere in the world and from any device.
Jul. 24, 2016 01:15 AM EDT Reads: 1,225
"We've discovered that after shows 80% if leads that people get, 80% of the conversations end up on the show floor, meaning people forget about it, people forget who they talk to, people forget that there are actual business opportunities to be had here so we try to help out and keep the conversations going," explained Jeff Mesnik, Founder and President of ContentMX, in this SYS-CON.tv interview at 18th Cloud Expo, held June 7-9, 2016, at the Javits Center in New York City, NY.
Jul. 23, 2016 11:45 PM EDT Reads: 1,233
Internet of @ThingsExpo has announced today that Chris Matthieu has been named tech chair of Internet of @ThingsExpo 2016 Silicon Valley. The 6thInternet of @ThingsExpo will take place on November 1–3, 2016, at the Santa Clara Convention Center in Santa Clara, CA.
Jul. 23, 2016 11:15 PM EDT Reads: 1,868
When people aren’t talking about VMs and containers, they’re talking about serverless architecture. Serverless is about no maintenance. It means you are not worried about low-level infrastructural and operational details. An event-driven serverless platform is a great use case for IoT. In his session at @ThingsExpo, Animesh Singh, an STSM and Lead for IBM Cloud Platform and Infrastructure, will detail how to build a distributed serverless, polyglot, microservices framework using open source tec...
Jul. 23, 2016 11:00 PM EDT Reads: 2,242
The 19th International Cloud Expo has announced that its Call for Papers is open. Cloud Expo, to be held November 1-3, 2016, at the Santa Clara Convention Center in Santa Clara, CA, brings together Cloud Computing, Big Data, Internet of Things, DevOps, Digital Transformation, Microservices and WebRTC to one location. With cloud computing driving a higher percentage of enterprise IT budgets every year, it becomes increasingly important to plant your flag in this fast-expanding business opportuni...
Jul. 23, 2016 10:15 PM EDT Reads: 2,446