CALGARY, ALBERTA--(Marketwire - Dec. 13, 2012) -
THIS NEWS RELEASE IS NOT FOR DISSEMINATION OR DISTRIBUTION IN THE UNITED STATES OF AMERICA, TO UNITED STATES NEWSWIRE SERVICES OR UNITED STATES PERSONS
Donnycreek Energy Inc. ("Donnycreek" or the "Company") (TSX VENTURE:DCK) announces that it has preliminary results from the Company's Kakwa horizontal Montney discovery well 13 - 17 - 63 - 5 W6M (the "13 - 17 Well") that was placed on production December 1, 2012. Various facility bottlenecks associated with downstream liquids processing have restricted the flowing capacity of the 13 - 17 Well, however, during the first seven days of production, the well has averaged over 200 barrels of well head condensate/mmscf natural gas. The 13 - 17 Well has flowed a production day average of 750 bbl/d of condensate and 3.7 mmscf/d of natural gas (1,367 boe/d gross; 444 boe/d net). Additional natural gas liquids recoveries at the third party gas plant are expected to add between 30 and 130 bbl/mmcf depending on whether the natural gas is processed through the deep cut plant. Well head flowing pressures of over 20 MPa (2,900 psi) have averaged about three times line pressure as the operator has worked with downstream plant operators to manage the substantial condensate volumes. Donnycreek has a 25% working interest plus 10% GORR on 75% working interest before payout; 50% working interest after payout in the 13 - 17 Well.
Donnycreek also advises that the tie in of the second horizontal Kakwa Montney well 14 - 30 - 63 - 5 W6M (the "14 - 30 Well") is on schedule and is projected to be ready to flow in early January 2013, subject to processing capacity. Donnycreek holds a 50% working interest in the 14 - 30 Well.
Donnycreek is scheduled to spud the third horizontal Kakwa Montney well 03 - 19 - 63 - 5 W6M (the "3 - 19 Well") within the next four days from the same well pad location as the 14 - 30 Well. The 3 - 19 Well is a development well, which will be drilled between the 13 - 17 Well and the 14 - 30 Well. The 3 - 19 Well is scheduled to be finished drilling by mid-late February 2013, with a planned hiatus during the Christmas holidays. Donnycreek holds a 50% working interest in the 3 - 19 Well.
About Donnycreek Energy Inc.
Donnycreek is a Calgary-based public oil and gas company which holds 232 gross sections; 159 net sections of petroleum and natural gas rights prospective primarily for Montney liquid rich natural gas resource development in its 3 core areas: Kakwa, Wapiti and Chicken, all of which are located in the Deep Basin area of west central Alberta.
Further information relating to Donnycreek is also available on its website at www.donnycreekenergy.com.
ON BEHALF OF THE BOARD OF DONNYCREEK ENERGY INC.
Malcolm F.W. Todd, Chief Executive Officer
ADVISORY ON FORWARD-LOOKING STATEMENTS: This news release contains certain forward-looking information and statements ("forward-looking statements") within the meaning of applicable securities laws. The use of any of the words "expect", "anticipate", "continue", "estimate", "may", "will", "project", "should", "believe", "plans", "intends" and similar expressions are intended to identify forward-looking statements. In particular, but without limiting the foregoing, this news release contains statements regarding the additional liquids recoveries for the 13 - 17 Well at the third party gas plant, the timing to begin flowing the 14 - 30 Well, the timing to spud and finish drilling the 3 - 19 Well and the prospective zone for development on the Company's lands.
Forward-looking statements are based on a number of material factors, expectations or assumptions of Donnycreek which have been used to develop such statements and information but which may prove to be incorrect. Although Donnycreek believes that the expectations reflected in these forward-looking statements are reasonable, undue reliance should not be placed on them because Donnycreek can give no assurance that they will prove to be correct. Since forward-looking statements address future events and conditions, by their very nature they involve inherent risks and uncertainties. In particular, in addition to other factors and assumptions which may be identified herein, no assurances can be given respecting: whether the Company's exploration and development activities respecting its prospects will be successful or that material volumes of petroleum and natural gas reserves will be encountered, or if encountered can be produced on a commercial basis; the ultimate size and scope of any hydrocarbon bearing formations on its lands; that drilling operations on its lands will be successful such that further development activities in these areas are warranted; that Donnycreek's efforts to raise additional capital will be successful; that Donycreek will continue to conduct its operations in a manner consistent with past operations; results from drilling and development activities will be consistent with past operations; the accuracy of the estimates of Donnycreek's reserve volumes; the general stability of the economic and political environment in which Donnycreek operates; drilling results; field production rates and decline rates; the general continuance of current industry conditions; the timing and cost of pipeline, storage and facility construction and expansion and the ability of Donnycreek to secure adequate product transportation; future commodity prices; currency, exchange and interest rates; regulatory framework regarding royalties, taxes and environmental matters in the jurisdictions in which Donnycreek operates; and the ability of Donnycreek to successfully market its oil and natural gas products.
Further, events or circumstances may cause actual results to differ materially from those predicted as a result of numerous known and unknown risks, uncertainties, and other factors, many of which are beyond the control of the Company, including, without limitation: changes in commodity prices; changes in the demand for or supply of the Company's products; unanticipated operating results or production declines; changes in tax or environmental laws, royalty rates or other regulatory matters; changes in development plans of Donnycreek or by third party operators of Donnycreek's properties, increased debt levels or debt service requirements; inaccurate estimation of Donnycreek's oil and gas reserve and resource volumes; limited, unfavourable or a lack of access to capital markets; increased costs; a lack of adequate insurance coverage; the impact of competitors; and certain other risks detailed from time-to-time in Donnycreek's public disclosure documents. Additional information regarding some of these risk factors may be found under "Risk Factors" in the Company's Management's Discussion and Analysis prepared for the year ended July 31, 2012. The reader is cautioned not to place undue reliance on this forward-looking statements. The forward-looking statements contained in this news release are made as of the date hereof and Donnycreek undertakes no obligations to update publicly or revise any forward-looking statements, whether as a result of new information, future events or otherwise, unless so required by applicable securities laws.
Where amounts are expressed on a barrel of oil equivalent ("BOE") basis, natural gas volumes have been converted to oil equivalence at six thousand cubic feet per barrel. The term BOE may be misleading, particularly if used in isolation. A BOE conversion ratio of six thousand cubic feet per barrel is based on an energy equivalency conversion method primarily applicable at the burner tip and does not represent a value equivalency at the wellhead. Given that the value ratio based on the current price of crude oil as compared to natural gas is significantly different from the energy equivalency of 6:1, utilizing a conversion on a 6:1 basis may be misleading as an indication of value.
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