CALGARY, Alberta, March 07, 2019 (GLOBE NEWSWIRE) -- Saturn Oil & Gas Inc. (“Saturn” or the “Company”) (TSX.V:
SOIL) (FSE: SMK) is pleased to provide an operational update, including details of the Company’s Q1/19 capital budget and drilling
program (the “Program”), along with forecast average production volumes for the quarter.
Capital Budget & Production Guidance for Q1 2019
Saturn’s Q1 2019 capital expenditure budget anticipates investing approximately $10 million, to be allocated to drilling,
completion, equip and tie-in of approximately nine gross (9.0 net) wells. The Company commenced its program with the first well
spud on January 14, 2019 in Saturn’s core Milton area, targeting the light oil Viking play. Through the end of February 2019,
Saturn has drilled, completed and tied-in a total of five gross (5.0 net) extended reach horizontal (“ERH”) Viking wells,
generating new volumes that have resulted in Saturn achieving a production rate over the last two weeks of February of over 1,000
boe/d. With Saturn’s capital spending program for Q1 2019, coupled with the well results realized through January and February, the
Company forecasts its Q1 production volumes will average approximately 950 boe/d, and achieve a peak production rate in Q1 of
approximately 1,300 boe/d. This peak production rate is an increase of over 80% from Q4 2018 average production.
In addition to the five (5.0 net) wells that have been brought on production, Saturn has drilled an additional
three (3.0 net) wells and anticipates drilling the ninth and final well in the week ending March 8th. As such, the Company
anticipates bringing four gross (4.0 net) additional wells online before the end of March 2019.
Based on current oil prices and oil differentials, Saturn’s forecast royalties of $3.00 to $4.00/boe, and
operating and transportation cost forecasts of $10.00 to $11.50/boe, the Company anticipates field netbacks¹ in the quarter
would range between $40.00 and $50.00/boe.
Q1 2019 Capital Program Details
Drilling activity in Q1 has been, and will continue to be, primarily focused in the Company’s core areas of Prairiedale, Milton and
Kerrobert. Of the eight Viking light oil wells drilled to date in 2019, two are ERH wells in Milton, two are ERH wells in
Kerrobert, and the balance are in Prairiedale. Funding for the Q1 program has been derived from the Company’s USD$20 million
revolving note facility with Prudential Capital Group (“Prudential”) coupled with cash flow generated during the period. Capital
expenditures for the balance of 2019 will be reviewed and established quarterly to reflect commodity prices, funding sources and
the broader operating environment.
Effective March 5, 2019, the Company has relocated its corporate headquarters to Calgary, Alberta from
Saskatoon, Saskatchewan, designed to support Saturn’s ongoing growth, enhance its visibility and build further relationships with
energy-focused capital markets participants.
To learn more about Saturn Oil & Gas Inc., please visit www.saturnoil.com.
About Saturn Oil & Gas Inc.
Saturn Oil & Gas Inc. (TSX.V: SOIL) (FSE: SMK) is a public energy Company focused on the acquisition and
development of undervalued, low-risk assets. Saturn is driven to build a strong portfolio of cash flowing assets with strategic
land positions. De-risked assets and calculated execution will allow Saturn to achieve growth in reserves & production through
retained earnings. Saturn's portfolio will become its key to growth and provide long-term stability to shareholders.
Investor & Media Contact:
Saturn Oil & Gas
John Jeffrey, MBA - Chief Executive Officer & Chairman
Tel: +1 (306) 955-9946
www.saturnoil.com
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.
Information Regarding Disclosure on Oil and Gas
Operational Information and Non-IFRS Measures
This news release contains metrics commonly used in the oil and natural gas industry, such as “cash flow” and "field netbacks".
These terms are not defined in IFRS and do not have standardized meanings or standardized methods of calculation and therefore may
not be comparable to similar measures presented by other companies, and therefore should not be used to make such comparisons. Such
metrics have been included herein to provide readers with additional information to evaluate the Company’s performance, however
such metrics should not be unduly relied upon. Management uses oil and gas metrics for its own performance measurements and to
provide shareholders with measures to compare Saturn’s operations over time. Readers are cautioned that the information provided by
these metrics, or that can be derived from the metrics presented in this press release, should not be relied upon for investment or
other purposes.
Forward-Looking Information and Statements
Certain statements contained in this release include statements which contain words such as "anticipate", "could", "should",
"expect", "seek", "may", "intend", "likely", "will", "believe" and similar expressions, relating to matters that are not historical
facts, and such statements of our beliefs, intentions and expectations about development, results and events which will or may
occur in the future, constitute "forward-looking information" within the meaning of applicable Canadian securities legislation and
are based on certain assumptions and analysis made by us derived from our experience and perceptions. Forward-looking information
in this release includes, but is not limited to: expected cash flow provided by continuing operations; future capital expenditures,
including the amount and nature thereof; oil and natural gas prices and demand; expansion and other development trends of the oil
and gas industry; business strategy and outlook; expansion and growth of our business and operations; and maintenance of existing
customer, supplier and partner relationships; supply channels; accounting policies; credit risks; and other such matters.
All such forward-looking information is based on certain assumptions and analyses made by us in light of our
experience and perception of historical trends, current conditions and expected future developments, as well as other factors we
believe are appropriate in the circumstances. The risks, uncertainties, and assumptions are difficult to predict and may affect
operations, and may include, without limitation: foreign exchange fluctuations; equipment and labour shortages and inflationary
costs; general economic conditions; industry conditions; changes in applicable environmental, taxation and other laws and
regulations as well as how such laws and regulations are interpreted and enforced; the ability of oil and natural gas companies to
raise capital; the effect of weather conditions on operations and facilities; the existence of operating risks; volatility of oil
and natural gas prices; oil and gas product supply and demand; risks inherent in the ability to generate sufficient cash flow from
operations to meet current and future obligations; increased competition; stock market volatility; opportunities available to or
pursued by us; and other factors, many of which are beyond our control.
Actual results, performance or achievements could differ materially from those expressed in, or implied by,
this forward-looking information and, accordingly, no assurance can be given that any of the events anticipated by the
forward-looking information will transpire or occur, or if any of them do, what benefits will be derived there from. Except as
required by law, Saturn disclaims any intention or obligation to update or revise any forward-looking information, whether as a
result of new information, future events or otherwise.
The forward-looking information contained herein is expressly qualified by this cautionary
statement.
BOE equivalent
Barrel of oil equivalents or 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 at 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 than the energy equivalency of 6:1, utilizing the 6:1 conversion ratio may be misleading as an indication
of value.
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¹ Non-IFRS measure that does not have any standardized meaning under IFRS and therefore may not be
comparable to similar measures presented by other entities. Refer to the section entitled “Information Regarding Disclosure on
Oil and Gas Operational Information and Non-IFRS Measures”.
