Razor Energy Corp. Provides an Operations Update, Announces 2017 Capital Budget and Guidance, and 2016 Year-End Results
Razor Energy Corp. ("Razor" or the "Company") (TSX VENTURE:RZE) (www.razor-energy.com) is pleased to announce our operating and financial results for the three and 12 month periods ended December 31, 2016. Our full audited consolidated financial statements and notes thereto, as well as management's discussion and analysis ("MD&A") can be found on SEDAR at www.sedar.com.
Since entering negotiations to acquire oil and gas properties during the fourth quarter of 2016, Razor has invested approximately $2.5 million to re-activate light oil production from 19 (17.5 net) suspended Swan Hills wells. These operations have resulted in the addition of approximately 690 (635 net) boepd with anticipated annual decline of less than 10 percent, which is the same decline trend prior to the wells being suspended.
Amongst other capital programs, the Company is in the process of initiating a second re-activation program including 24 (22.0 net) suspended wells to liberate additional light oil at low decline rates. Concurrently, Razor is participating in an additional 24 (3.1 net) well non-operated re-activation program.
Razor is appropriately staffed for future growth, comprised of skilled and competent staff in all functional departments. Our head office staff complements the 14 fulltime, talented, and dedicated field staff led by Scott Littke and Robert Dowsett executing daily operations in the Swan Hills area. All technical, operating and production staff continue to apply rigor and discipline on cost reduction and value generation while embracing stewardship roles with a view of serving the interests of all stakeholders.
2017 CAPITAL BUDGET
With the market volatility in commodity prices and Razor's ability to grow production through high frequency / low capital intensive projects and with emerging acquisition opportunities, the Company expects to take a disciplined and conservative approach to the 2017 budget. This capital budget will be reviewed continuously by management and the Board of Directors of the Company (the "Board") for changes in commodity price assumptions and project economics. We remain steadfast in our conviction to maintain our financial advantage and build a top-tier junior oil and gas company.
For fiscal 2017, the Board has approved a capital expenditure budget of $13.0 million. The Company has or intends to invest in a combination of re-activations, re-entries, perforations, re-completions, workovers, stimulations, and waterflood optimizations. In addition, the budget addresses the Alberta Energy Regulator's requirement under the Inactive Well Compliance Program, and other end of life well and facility spending.
With innovative focus and disciplined capital deployment in the Swan Hills area, the Company believes that it is well positioned to execute on its growth strategy while maintaining financial flexibility.
The Company intends to continue to pursue value-driven acquisitions. This is expected to include a consolidation of land positions within the Company's existing project areas, in addition to targeting new potential opportunities in complementary shallow, light oil, horizons within its Alberta core region. The Company is focused on adding to its inventory of high-quality projects to sustain longer-term growth.
During the fourth quarter and year-ended December 31, 2016, the current management and Board negotiated a business combination with Vector Resources Inc. ("Vector"). This combination, in conjunction with a term loan facility provided by Alberta Investment Management Corporation ("AIMCo") and asset acquisition in the Swan Hills area of Alberta (the "Asset"), provided the necessary operational foundation to position Razor for future growth.
Subsequent to the end of 2016, Razor achieved the following milestones:
Razor Energy Corp., is a light oil focused company operating predominantly in Alberta. Razor's full-cycle business plan provides an opportunity to reposition the Company as a disciplined and high-growth junior E&P company. With an experienced management team and a strong, committed Board, growth is anticipated to occur through timely strategic acquisitions and operations. Razor currently trades on TSX Venture Exchange under the ticker "RZE".
SOURCE: Razor Energy Corp.
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