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Delphi Energy provides update

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Oilfield Technology,



Delphi is now singularly focused on its Bigstone assets where it holds 139.5 gross sections (118.1net) of Montney rights and 81.5 gross sections (60.0 net) of contiguous shallow Cretaceous rights.

The Bigstone Montney now represents 87% of corporate production.

While the oil and gas industry remains in a very challenging environment, Delphi’s accomplishments during 2015 have transformed the Company, positioning it to successfully navigate through this prolonged low commodity price environment. Several of these accomplishments include:

  • Achievement of the Company’s 2015 annual and exit production guidance.
  • Successful drilling of six extended-reach Montney horizontal wells in Bigstone reducing the number of days from spud to total depth from 32 days to 28 days.
  • Reducing drilling and completion costs from $10.2 million in the first quarter of 2015,to a company record low of US$6.5 million in the fourth quarter of 2015 through innovative design changes, improved efficiencies and lower cost of services.
  • Closed on the disposition of its non-core lower netback assets at Wapiti and Hythe, Alberta for total gross proceeds of US$62 million; and reduced net debt by 33% to an expected US$122 -124 million at the end of the year, from a high of approximately US$181 million at the end of the first quarter, with an expected net debt to annualised fourth quarter funds from operations ratio of approximately 2.6-2.8
  • Operations update

    The company’s fifth well of the 2015 programme located at 14-24-60-23W5 (0.83 net),commenced production in late December.

    Delphi has also completed the drilling of its sixth horizontal Montney well of 2015 at 14-27-60-23W5. Completion operations, utilising the Company’s newly optimised slickwater frack design over a 37 stage liner, are scheduled to commence in January 2016.

    The first well of Delphi’s 2016 capital programme in the Montney formation at 13-21-60-23W5 (“13-21”) in the Bigstone area has commenced drilling.The 13-21 well is the first of two wells expected to be drilled in Bigstone this winter.

    On December 1, 2015, the company began transporting most of its natural gas under its Alliance full path firm service agreement, eliminating exposure to production curtailments and Alberta based natural gas price weakness.

    Delphi estimates US$6.0 -US$7.0 million in reduced operating costs in 2016 over 2015, as the more efficient Montney production replaces the lower netback properties disposed of in 2015. In addition, with the disposition of the lower netback properties, the Company has reduced its staff from 36 to 24 (34%), resulting in expected general and administrative savings of US$2.0 -US$2.5 million

    Reduced capital costs and lower operating costs, combined with a superior asset has enabled the Company to continue to deploy capital to its Montney play with a high return on investment.


    Adapted from a press release by Louise Mulhall

    Read the article online at: https://www.oilfieldtechnology.com/drilling-and-production/04012016/delphi-energy-provides-operational-update/

     

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