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Last updated on April 16, 2014 at 13:15 EDT

Bellatrix announces a $300 million Cardium joint venture, acquires additional development lands, updates operating results and secures additional commodity hedges

January 22, 2013

TSX, NYSE MKT: BXE

CALGARY, Jan. 22, 2013 /PRNewswire/ – Bellatrix Exploration Ltd. (“Bellatrix”
or the “Company”) (TSX: BXE) has entered into a joint venture agreement
with a Seoul Korea based company (“JV Partner”), to accelerate
development of Bellatrix’s extensive undeveloped Cardium land holdings
in west-central Alberta. Under the terms of the agreement, the JV
Partner will contribute 50%, or  CDN$150 million, to a $300 million
joint venture (the “Joint Venture”) to participate  in an expected 83
Cardium well program. Under the agreement, the JV Partner will earn 33%
of Bellatrix’s working interest in the Cardium well program until
payout (being recovery of the JV Partner’s capital investment plus an
8% return on investment) on the total program, which is expected to
occur prior to a maximum of 7 years, reverting to a 20% working
interest after payout. The effective date of the agreement is April 1,
2013 but with the ability of the JV Partner to elect to invest in the
wells drilled between January 1 up to April 30, 2013. Certain
conditions precedent are expected to be satisfied or waived by April
22, 2013 which is expected to enable closing to occur on or before
April 30, 2013.  Bellatrix will be required to provide a guarantee of
the return of the JV Partner’s capital investment of up to $30 million
if not recovered within 7 years.

As a result of the Joint Venture, Bellatrix’s net capital expenditure
plan for 2013 is expected to increase from the previously announced
$180 million level to between $230 and $240 million not including JV
Partner capital. Based on the timing of proposed expenditures, downtime
from anticipated plant turnarounds, completion of anticipated
infrastructure and normal production declines, execution of the
increased 2013 capital expenditure plan is anticipated to provide
average daily production of 24,000 to 25,000 boe/d. The Company is
anticipating a 2013 exit rate of 30,000 to 31,000 boe/d.

On December 14, 2012, Bellatrix acquired an additional 11 gross and net
sections of highly prospective Cardium and Notikewin/Falher lands in
the Ferrier area of west central Alberta. This acquisition is
anticipated to provide an additional 37 net drilling locations in the
Cardium, 9 net locations in the Notikewin/Falher and an additional 66
net locations in the Duvernay formation.

Bellatrix continues to focus on growth by development of its core
Cardium and Notikewin/Falher assets utilizing its large inventory of
geological prospects. The Company has developed an inventory of 692 net
remaining Cardium locations and 401 net Notikewin/Falher locations
representing a net remaining capital requirements of $4.34 billion
based on current costs. As at December 31, 2012, Bellatrix has
approximately 206,638 net undeveloped acres and including all
opportunities has in excess of 1,700 net exploitation drilling
opportunities identified, with capital requirements of $8.17 billion
based on current costs representing over 40 years of drilling inventory
based on current annual cash flow.  The Company continues to focus on
adding Cardium and Notikewin prospective lands.

Bellatrix’s second long reach horizontal well (50% WI) drilled in Q4
2012 has been placed on production at the following rates for the
initial producing 7 days  (IP7), 15 days (IP15), and 30 days (IP30):


                                                                  IP7  1,280
                                                                  -    boe/d

                                                                  IP15 1,127
                                                                  -    boe/d

                                                                       944
                                                                  IP30 boe/d
                                                                  -    (25% gas
                                                                       and 75%
                                                                       liquids)

Bellatrix recently entered into additional commodity price risk
management contracts  for   natural gas fixed price swaps for 10,000
GJ/d for the period February 1, 2013 to December 31, 2013 and 15,000
GJ/d for the period April 1, 2013 to June 30, 2014 at prices of
CDN$3.05/GJ (CDN$3.51/mcf).

As at January 21, 2013, Bellatrix has the following crude oil and
natural gas commodity fixed price risk management contracts in place
for 2013 and 2014 (converted to a mcf basis excluding the crude oil
call options).  The conversion of $/GJ to $/mcf is based on an average
corporate heat content rate of 40.8 Mj/m(3).

     _____________________________________________________________________
    |   Product |                  Term       |   Volume  | Average Price |
    |___________|_____________________________|___________|_______________|
    | Crude Oil |Jan. 1, 2013 to Dec. 31, 2013|1,500 bbl/d|$94.50 CDN/bbl |
    |___________|_____________________________|___________|_______________|
    |Natural Gas|Feb. 1, 2013 to Mar. 31, 2013|8.7 mmcf/d | $3.51 CDN/mcf |
    |___________|_____________________________|___________|_______________|
    |Natural Gas|Apr. 1, 2013 to Oct. 31, 2013|47.8 mmcf/d|  $4.17 CDN/mcf|
    |___________|_____________________________|___________|_______________|
    |Natural Gas|Nov. 1, 2013 to Dec. 31, 2013|21.7 mmcf/d| $3.51 CDN/mcf |
    |___________|_____________________________|___________|_______________|
    |Natural Gas|Jan. 1, 2014 to Jun. 30, 2014|13.0 mmcf/d| $3.51 CDN/mcf |
    |___________|_____________________________|___________|_______________|

As at January 21, 2013, the details of the above commodity price risk
management arrangements are as follows:


    Type                Period       Volume           Price             Price       Index
                                                      Floor           Ceiling

                         Jan.                     $               $
                          1,
    Crude                2013        1,500
    oil                   to         bbl/d           94.50          94.50 CDN        WTI
    fixed                Dec.                         CDN
                         31,
                         2013

                         Jan.                                     $
    Crude                 1,
    oil                  2013        3,000
    call                  to         bbl/d              -           110.00           WTI
    options              Dec.                                          US
                         31,
                         2013

                         Jan.                                     $
    Crude                 1,
    oil                  2014        3,000
    call                  to         bbl/d              -           105.00           WTI
    options              Dec.                                          US
                         31,
                         2014

                         Apr.                     $               $
                          1,
    Natural              2013        20,000                            4.0875
    gas                   to          GJ/d          4.0875             CDN          AECO
    fixed                Oct.                         CDN
                         31,
                         2013

                         Apr.                     $               $
                          1,
    Natural              2013        10,000                             4.15
    gas                   to          GJ/d          4.15                 CDN        AECO
    fixed                Oct.                         CDN
                         31,
                         2013

                         Feb.                     $               $
                          1,
    Natural              2013        10,000
    gas                   to          GJ/d          3.05             3.05           AECO
    fixed                Dec.                         CDN              CDN
                         31,
                         2013

                         Apr.                     $               $
                          1,
    Natural              2013        15,000
    gas                   to          GJ/d          3.05             3.05           AECO
    fixed                Jun.                         CDN              CDN
                         30,
                         2014

Bellatrix will be a presenter at the National Bank Financial Energy
Conference being held in Toronto, Canada on February 13(th) and 14(th), 2013. Prior to this conference, an updated Corporate Presentation will
be made available at www.bellatrixexploration.com.

Bellatrix Exploration Ltd. is a Western Canadian based growth oriented
oil and gas company engaged in the exploration for, and the
acquisition, development and production of oil and natural gas reserves
in the provinces of Alberta, British Columbia and Saskatchewan.  Common
shares and convertible debentures of Bellatrix trade on the Toronto
Stock Exchange (“TSX”) under the symbols BXE and BXE.DB.A, respectively
and the common shares of Bellatrix trade on the NYSE MKT under the
symbol BXE.

All amounts in this press release are in Canadian dollars unless
otherwise identified.

Forward looking statements: Certain information set forth in this news
release, including management’s assessments of the future plans and
operations including  anticipated 2013 average daily production and
exit rate, anticipated expected satisfaction of conditions to the Joint
Venture and closing of the Joint Venture, anticipated timing of payout
under the Joint Venture, 2013 capital expenditure budget, number of
additional drilling locations as a result of land acquisition, drilling
inventory and amount of capital required to develop inventory and time
for development may contain forward-looking statements, and necessarily
involve risks and uncertainties, certain of which are beyond
Bellatrix’s control, including risks related to satisfaction of
conditions precedent to the Joint Venture and related to closing
thereof, risks associated with oil and gas exploration, development,
exploitation, production, marketing and transportation, loss of markets
and other economic and industry conditions, volatility of commodity
prices, currency fluctuations, imprecision of reserve estimates,
environmental risks, competition from other producers, inability to
retain drilling services, incorrect assessment of value of acquisitions
and failure to realize the benefits therefrom, delays resulting from or
inability to obtain required regulatory approvals, the lack of
availability of qualified personnel or management, stock market
volatility and ability to access sufficient capital from internal and
external sources and economic or industry condition changes. Actual
results, performance or achievements could differ materially from those
expressed in, or implied by, these forward-looking statements and,
accordingly, no assurance can be given that any events anticipated by
the forward-looking statements will transpire or occur, or if any of
them do so, what benefits that Bellatrix will derive therefrom.
Additional information on these and other factors that could affect
Bellatrix are included in reports on file with Canadian securities
regulatory authorities and the United States Securities and Exchange
Commission and may be accessed through the SEDAR website (www.sedar.com), the SEC’s website (www.sec.gov or at Bellatrix’s website www.bellatrixexploration.com. Furthermore, the forward-looking statements contained in this news
release are made as of the date of this news release, and Bellatrix
does not undertake any obligation to update publicly or to revise any
of the included forward looking statements, whether as a result of new
information, future events or otherwise, except as may be expressly
required by applicable securities law.

Conversion: The term barrels of oil equivalent (“boe”) may be
misleading, particularly if used in isolation. A boe conversion ratio
of six thousand cubic feet of natural gas to one barrel of oil
equivalent (6 mcf/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 from the energy equivalency of 6:1, utilizing a
conversion on a 6:1 basis may be misleading as an indication of value.
All boe conversions in this report are derived from converting gas to
oil in the ratio of six thousand cubic feet of gas to one barrel of
oil.

Initial production rates:  Initial production rates disclosed herein may
not necessarily be indicative of long-term performance or ultimate
recovery.

 

SOURCE Bellatrix Exploration Ltd.


Source: PR Newswire