CALGARY, ALBERTA--(Marketwired - Feb. 28, 2014) - Contact Exploration Inc. ("Contact" or the "Company") (TSX VENTURE:CEX) is pleased to announce that it has today filed its condensed interim consolidated financial statements for the three and nine month periods ended December 31, 2013 and the related management's discussion and analysis ("MD&A") on the Company's profile on the System for Electronic Document Analysis and Retrieval ("SEDAR") website at www.sedar.com.
Credit Facility Increase
The Company is also pleased to announce that its senior lender has increased the amounts available under the Company's credit facilities to $7.7 million. The amended operating facility has been increased to $4.5 million and the non-revolving acquisition and development demand loan has been increased to $3.2 million. No amounts are currently drawn under either facility.
Operations Update
Contact is currently in the late stages of drilling the Contact operated well at 02/14- 30 -63-5 W6M ("02/14-30 Well"). This well was originally programmed to target a bottom hole location of 15- 30 -63-5 W6M, but during drilling it became operationally advantageous to target a bottom hole location of 14- 30 -63-5 W6M. The 02/14-30 Well is being drilled in the Upper Montney D4 interval. The Company anticipates that completion operations on the 02/14-30 Well will be finalized in late March 2014. With success, Contact expects the 02/14-30 Well to be equipped and flowing into the Company's central compression and condensate stabilization facility in May 2014. Upon rig release of the 02/14-30 Well, the Company anticipates spudding a well by mid-March 2014 from a centrally located pad at 7-19-63-5 W6M, with the intention of drilling a minimum of two new wells from this surface location through spring break-up 2014.
Contact's 5-23-63-6 W6M (25% WI) well was brought on production in early January 2014 and averaged 2.0 mmcf/d (gross) natural gas production during its first 30 days of production, with an average field condensate production estimate of 350bbl/d (gross) (being 500 mcf/d and 88bbl/d, or 171 boe/d, net to Contact).
Contact's 16-25-63-6 W6M (25%) well was brought on production in early February 2014 and has averaged 2.3 mmcf/d (gross) natural gas production during its first 26 days of production, with an average field condensate production estimate of 430bbl/d (gross) (being 575 mcf/d and 107bbl/d, or 203 boe/d, net to Contact).
Contact's 16-17-63-5 W5M (25% WI) well was brought on production in mid-February 2014, which well has experienced production performance similar to the other Contact wells brought on production in 2014.
Since bringing its central compressor and condensate stabilization facility online in mid-January 2014, Contact's aggregate net production has fluctuated between 500 - 800 boe/d, on per producing day basis. Contact expects production from its existing Kakwa wells to stabilize once all early stage operational matters are addressed in the normal course. Rates will also be subject to normal production declines, which Contact expects to offset with production from new wells scheduled to be drilled at Kakwa.
About Contact Exploration Inc.
Contact Exploration Inc. is a public oil and gas company which has a long-term history of operating in Atlantic Canada and has recently demonstrated success in Alberta's liquids-rich Montney Formation tight gas play. For more information, please see the Company's website: www.contactexp.com
ADVISORY ON FORWARD-LOOKING STATEMENTS: This press release contains certain forward-looking information and statements within the meaning of applicable securities laws. The use of any of the words "expect", "continue", "estimate", "may", "will", "should", "believe", "plans", "cautions" and similar expressions are intended to identify forward-looking information or statements. In particular, but without limiting the forgoing, this press release contains statements concerning the timing to complete, equip and tie-in the 02/14-30 Well, the timing to drill up to two new wells from a pad at 7-19-63-5 W6M, the timing for production from its existing Kakwa wells to stabilize and the expectation for production from new wells scheduled to be drilled at Kakwa. Forward-looking statements or information are based on a number of material factors, expectations or assumptions of Contact which have been used to develop such statements and information but which may prove to be incorrect. Although Contact believes that the expectations reflected in these forward-looking statements are reasonable, undue reliance should not be placed on them because Contact 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. In particular, in addition to other factors and assumptions which may be identified herein, no assurances can be given respecting: whether the Company's exploration and development activities respecting the Deep Basin Montney project 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 at the Deep Basin Montney project; that additional drilling and completion operations in the Deep Basin Montney project will be successful such that further development activities in this area is warranted; that Contact 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 accuracy of the estimates of Contact's reserve volumes; the general stability of the economic and political environment in which Contact 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 Contact 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 Contact operates; and the ability of Contact to successfully market its oil and natural gas products.
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: 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, royalty rates or other regulatory matters; changes in development plans of Contact or by third party operators of Contact's properties, increased debt levels or debt service requirements; inaccurate estimation of Contact'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 Contact's public disclosure documents. Additional information regarding some of these risk factors may be found under "Risk Factors" in the Company's Management Discussion and Analysis prepared for the year ended March 31, 2013. The reader is cautioned not to place undue reliance on this forward-looking information. The forward-looking statements contained in this press release are made as of the date hereof and Contact undertakes no obligations to update publicly or revise any forward-looking statements or information, whether as a result of new information, future events or otherwise, unless so required by applicable securities laws.
Neither TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.