ARC will be a Major Player (500,000 boe ++)Arc total land base is roughly 1537 sections in total, this includes Attachie which is in early development and that represent 308 sections of land.
Area Acres Prod PDP Reserves Gas Prod Liquids Condensate
Boe/day MMboe MMcf/day 1000 boe
Greater Dawson 149,800 91,219 139 427.5 19,972 126
Sunrise 23,100 43,242 66 259.2 43 0
Kakwa 493,000 172,890 259 437.6 99,952 348
Ante Creek 122,000 17,331 22 53.2 8,461 413
Attachie 202,000 4,418 7 12.2 2,380 505
New Acquisiton Play Area
ARC total production last quarter was about 335,000 boe a day, Arc's recent acquisition essentially double ARC’s production, all from a single well developed play area. A play area that has historically produced about 230,000 boe a day.
Historically (Pre Covid) it produced 230,000 Boe/day, Returning to those production levels would represent a 33% increase from this play area’s current production or would represent a 17% overall increase in corporate production of the company. (Proven Production History)
57% Liquids (60% condensate)
The new production boe’s associated with the acquisition are 57% liquids and represent the best largescale netbacks from a single play area in the entire Montney. (Over 100,000 boe/day)
This acquisition area came with 1010 MMcf of access to gas processing which 750 MMcf is 100% owned by ARC, and access to 80,000 boe of condensate stabilization.
Last quarter plant utilization was 443 MMcf or approximately 43.8% of the available plant capacity.
Land + Reserves +Plant
This play area has more than 53 percent of all of ARC booked reserves and represents ½ of their entire land base in this single play, with 4 fully build and commissioned gas plants.
So ARC just doubled their land base and they have 4 gas plants available to them with 1010 MMcf of production available. If they were to suggest that their strategy is to fill the plant with production that represent the best netbacks in the entire Montney. This plan would be associated with 1010 MMcf of processing capacity and approximately of 500,000 acres of Montney land.
LINE OF SIGHT 575,000 BOE
ARC has clear line of sight to 575,000 boe with this acquisition alone, with all the current in place infrastructure and one of the largest proven resources to draw upon.
Does ARC sound like is should be good competition for TOU, TOU can’t compete with ARC on a Liquids basis, and does not have the same resource base to draw on that ARC does, this is key and ARC is currently trading at half its value.( 50% DISCOUNT )
Arc management were brilliant and did an acquisition where the reserves and plant were in place that is totally capable of a double in production of the assets acquired, on the basis of 1/2 cycle economics. Brillant.
This acquisition play area has the plant capacity to produce 350,000 - 400,000 boe/day. That the message they need to get out. ARC has the dirt that all others just dream about. That is why that plant and resouce was put in place, and what other company has 175,000 boe/day of 1/2 cycle production potential, none that i know of.
IMHO