CALGARY, ALBERTA--(Marketwired - April 7, 2014) - Donnycreek Energy Inc. ("Donnycreek" or the "Company") (TSX VENTURE:DCK) reports that its eighth Kakwa horizontal Montney well at 02/14-30-63-5 W6 (the "02/14-30 Well") (Donnycreek 50% working interest) drilled in the upper Montney interval has been successfully completed and tested. The 02/14-30 Well was drilled to a total measured depth of approximately 4,563 metres, with a horizontal leg of approximately 1,068 metres, approximately 200-500 metres shorter than previous Company Kakwa wells and the shortest of the Company's Kakwa horizontal Montney wells drilled to date. The 02/14-30 Well was completed using a water-based nitrogen foam frac and then tested for approximately 119 hours, flowing up 4.5 inch casing. During the final 24 hours of flow-back the 02/14-30 Well continued to clean up frac fluid and produced against anticipated gathering system pressure of approximately 1,800 kPa and averaged gross production rates of approximately 1,076 boe/d consisting of 621 bbl/d of condensate and 2,734 mscf/d of natural gas (310 bbl/d and 1,367 mscf/d, or 539 boe/d combined, net to Donnycreek).
Final equipping of the 02/14-30 Well and onsite facilities work will begin immediately to provide for tie-in of production from the 02/14-30 Well into Company-owned infrastructure. Donnycreek anticipates that the 02/14-30 Well should be ready for production in May 2014.
Donnycreek is encouraged by the test rates and ratio of condensate to natural gas production from this upper Montney interval and the potential for additional development of the upper Montney across its entire Kakwa land position. Production test results from the upper Montney interval in the 02/14-30 Well have been reported at this time given this is a previously untested Montney interval on Donnycreek's 50% working interest 16.75 section Kakwa land block. As previously reported, Donnycreek expects to release any further development drilling production results at Kakwa based on 30 day initial production rates.
The Company advises that although the initial rates from the 02/14-30 Well are encouraging, production test results are not necessarily indicative of long-term performance or of ultimate recovery from the 02/14-30 Well.
Donnycreek is a Calgary based public oil and gas company which holds approximately 438 gross (313 net) sections of petroleum and natural gas rights, with an average working interest of approximately 70%, prospective primarily for Montney liquid rich natural gas resource exploration and development 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, President and 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 concerning the equipping, tie-in and the timing of production from the 02/14-30 Well, the development potential of the upper Montney on the Company's Kakwa land position, the release of further production results and the primary prospective zone for exploration and 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. 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: 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 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 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; 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, 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 risks, expectations or assumptions and other factors may be found under in the Company's Annual Information Form for the year ended July 31, 2013 and the Company's Management's Discussion and Analysis prepared for the year ended July 31, 2013. The reader is cautioned not to place undue reliance on these 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.
In this news release the calculation of barrels of oil equivalent (boe) is calculated at a conversion rate of six thousand cubic feet (6 mcf) of natural gas for one barrel (bbl) of oil based on an energy equivalency conversion method. Boes may be misleading particularly if used in isolation. A boe conversion ratio of 6 mcf: 1 bbl is based on an energy equivalency conversion method primarily applicable to 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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