Questerre Expands Montney Core Area

Source: www.gulfoilandgas.com 5/14/2013, Location: North America

Questerre Energy Corporation ("Questerre" or the "Company") reported on its financial and operating results for the first quarter of 2013.

Michael Binnion, President and Chief Executive Officer, commented, "We built a meaningful land position for the liquids-rich Montney in the first quarter of 2013. Based on early well successes last year, we increased our operated acreage in the fairway and now hold 45 net sections. Our fourth well tested at approximately 1,800 boe/d. Recent land sales and industry activity continue to validate our decision to develop this as a new core area."

Highlights

- Doubled landholdings for liquids-rich Montney natural gas play in Alberta to 45 net sections
- Fourth Montney well tests at gross rates of approximately 1,800 boe/d with over 45% condensate and natural gas liquids
- Expanding pilot waterflood to increase recovery for light oil pool in Antler, Saskatchewan
- Field constructability tests mostly complete for oil shale joint venture with Total S.A. and Red Leaf
- Cash flow from operations of $3.65 million for the quarter with average daily production of 1,000 boe/d

Commenting on the Company's oil shale assets he added, "We are also very encouraged by the progress made by Red Leaf. They are transitioning from research and development to executing on the Early Production System phase of their oil shale joint venture in Utah with Total S.A. We conducted a site visit during the quarter and saw some of the in-field testing successfully completed. We also continued to assess our own oil shale acreage at Pasquia Hills. The core data from our program last fall is being analyzed and we expect to have the results this summer."

Production increased to 1,000 boe/d during the first quarter of 2013 from 725 boe/d in the prior year first quarter with the increase due to early production from the Kakwa-Resthaven area. With 78% of production from oil and natural gas liquids, Questerre reported cash flow from operations of $3.65 million (2012: $3.29 million). As spring breakup is underway, the Company expects that production in the second quarter will trend lower with several wells at Antler shut-in due to restricted road access and limited drilling planned for the period.

Questerre invested $25.96 million in its assets in the first quarter of 2013. $23.91 million was for the liquids-rich Montney in Alberta, with $19.11 million of this amount on land acquisition and the remainder drilling, completing and equipping wells in this area. Additionally, $1.35 million was invested in Saskatchewan, drilling one well and acquiring 3-D seismic as well as analyzing core for the oil shale at Pasquia Hills. As at March 31, 2013, the Company reported a working capital surplus of $12.84 million.

The Company also announced that it has adopted a Shareholder Rights Plan (the "Rights Plan") effective immediately. The Rights Plan must be ratified by shareholders at Questerre's next annual meeting in 2013, which is currently scheduled for June 11, 2013, failing which it will cease to have effect. Upon ratification by shareholders, the Rights Plan will continue in effect for an initial term of three years and is subject to reconfirmation by shareholders at the third annual meeting held after each confirmation.

The Rights Plan is designed both to encourage the fair and equal treatment of Questerre's shareholders in connection with any potential take-over bid and to ensure that its shareholders and its Board of Directors, in compliance with corporate and securities laws, have sufficient time to consider whether there are other options that would more effectively maximize shareholder value. The Rights Plan is not intended to deter take-over proposals. The terms of the Rights Plan are similar to those in rights plans recently approved by shareholders of other Canadian corporations. Questerre is not aware of any specific take-over bid for the Company in process or currently being contemplated.

The rights issued under the Rights Plan become exercisable when a person, together with any parties related to it, acquires or announces its intention to acquire, 20% or more of the Company's outstanding common shares without complying with the "Permitted Bid" provisions of the Rights Plan or without approval of Questerre's Board of Directors. Should such an acquisition occur each right would entitle a holder, other than the acquiring person or persons related to it, to purchase common shares of Questerre at a significant discount to the then current market price. A "Permitted Bid" is a bid made to all Questerre shareholders that is open for at least 60 days. If at the end of the 60 day period more than 50% of Questerre's then outstanding common shares, other than those common shares owned by the party making the bid and certain related persons, have been tendered to the bid, such party may take up and pay for the common shares but must extend the bid for a further 10 business days to allow other shareholders to tender.

For more information about related Opportunities and Key Players visit Oil Shale Projects


Related Categories: Coalbed Methane  General  Heavy Oil  Methane Clathrate  Oil Sands  Oil Shale  Shale Gas  Tight Gas  Tight Oil 

Related Articles: Coalbed Methane  General  Heavy Oil  Methane Clathrate  Oil Sands  Oil Shale  Shale Gas  Tight Gas  Tight Oil 


Gulf Oil and Gas
Copyright 2023 ICT All rights reserved. - Terms of Service - Privacy Policy.