In my inbox from the company:
<<Calgary, November 1, 2000 - - Purcell Energy Ltd. and its partners announce that gas production commenced today from the Chevron M-25 (24% interest) well at Fort Liard, NWT. Raw gas production started at a rate of 35 million cubic feet per day (mmcf/d) and in the next week the rate will ramp up to 50 mmcf/d. At the end of November, the Corporation expects that the rate will be increased to 70-75 mmcf/d. M-25 is located about 8 kms south of the Chevron K-29 well. K-29 (24% interest) started production April 29, 2000 and has produced almost 11 bcf of raw gas. Production at K-29 is currently about 70 mmcf/d. For the month of November, 2000, the combined Fort Liard cash flow (after all expenses and royalties), net to Purcell, will be approximately $3 million.
Purcell has scheduled the recompletion of the original F-25A (60% interest) discovery well at Fort Liard for January, 2001. This well is expected to start production in March, 2001 at 15 mmcf/d of raw gas. The F-25A gas will
be processed through the M-25 wellsite facility.
Purcell has entered into one year fixed price gas sales contracts totalling 16 mmcf/d at an average price of $6.30 (CDN) at the Sumas, B.C. export point commencing November 1, 2000. These contracts guarantee an excellent
wellhead price for the Corporation in the next year. Based on these contracts, Purcell's forecast of 2001 cash flow has been increased to $40 million ($1.67 per share). Pay out of capital costs under the federal government royalty regulations is estimated to occur in the second quarter of next year, resulting in average royalties in 2001 of about 23% for the Fort Liard gas production.
The Corporation continues to develop its northeastern British Columbia gas exploration projects. A total of 12,000 net acres of land were acquired in the last six months. Drilling of the first wells is planned for this
winter.
Purcell announces completion of purchases under its normal course issuer bid that commenced March 10, 2000. A total of 2 million common shares were acquired under the bid at an average price of $3.53 per share. The shares
were cancelled, reducing Purcell's currently issued shares to about 24.5 million.>>
Things are looking good. Can't argue with hedging a good part of their oncoming production at historically high gas prices, looking into summer '01. |
