Enterra Energy Trust Announces Intent to Convert to E&P Company Called Equal Energy
Since late 2007, there have been major changes to Enterra’s management and Board, as well as to the Trust’s business plan, financial stability, operations and asset base. Under a new name and corporate brand, Equal Energy will be able to continue to build on these successes. The conversion would be subject to the approval of the unitholders as well as customary court and regulatory approvals, and is anticipated to be completed on or before
Equal Energy will continue to pursue the exploration and development of its
Rationale for reorganization
Enterra must convert from a Trust model because of imminent tax changes in
- production levels have been cost effectively optimized. - a cost control strategy has been implemented and has resulted in reduced operating expenses and general and administrative expenses. - outstanding indebtedness has been reduced by half to approximately $150 million and the operating cost structure has been rationalized to ensure that Enterra now has the financial flexibility to pursue a more growth oriented exploration and production business plan.
Our key focus areas
Enterra has operated the Hunton play for almost 4 years, with 64 wells drilled, and a 97 percent success rate. Finding and development (“F&D”) costs have been extremely low, with future F&D costs are anticipated to be less than
Cardium Formation, west central
Beginning in 2010 Enterra anticipates a multi-year drilling program of 10 to 16 horizontal wells and will utilize multi-stage fracture stimulation technology to maximize resource recovery potential of light gravity sweet crude oil from this play.
Drilling of first horizontal oil well is currently underway and the results of testing are expected in early 2010. Enterra has a 40 percent working interest in over 11,000 acres in the play at this point.
Pekisko Formation, Princess,
Several locations have been identified for Pekisko wells on current developed and undeveloped acreage and additional potential oil wells have been identified in other formations in this area.
Twenty One Mature Oil Pools
The Trust currently operates twenty one mature oil pools with low decline rates but high water cuts. Opportunities exist for further infill drilling which will increase the efficiency of the production, particularly through the use of newer horizontal drilling and completion techniques.
Approvals and timing
The corporate conversion will be subject to receipt of all required regulatory, stock exchange and Court of Queen’s Bench of
About Enterra Energy Trust
Enterra is an exploration and production oil and gas trust based in
Certain information in this press release constitutes forward-looking statements under applicable securities law. Any statements that are contained in this press release that are not statements of historical fact may be deemed to be forward-looking statements. Forward-looking statements are often identified by terms such as “may,” “should,” “anticipate,” “expects,” “seeks” and similar expressions. Forward-looking statements necessarily involve known and unknown risks, including, without limitation, risks associated with oil and gas production; marketing and transportation; loss of markets; volatility of commodity prices; currency and interest rate fluctuations; imprecision of reserve estimates; environmental risks; competition; incorrect assessment of the value of acquisitions; failure to realize the anticipated benefits of acquisitions or dispositions; inability to access sufficient capital from internal and external sources; changes in legislation, including but not limited to income tax, environmental laws and regulatory matters. Readers are cautioned that the foregoing list of factors is not exhaustive.
Readers are cautioned not to place undue reliance on forward-looking statements as there can be no assurance that the plans, intentions or expectations upon which they are placed will occur. Such information, although considered reasonable by management at the time of preparation, may prove to be incorrect and actual results may differ materially from those anticipated. Forward-looking statements contained in this press release are expressly qualified by this cautionary statement.
Additional information on these and other factors that could affect Enterra’s operations or financial results are included in Enterra’s reports on file with Canadian and U.S. securities regulatory authorities and may be accessed through the SEDAR website (www.sedar.com), the SEC’s website (www.sec.gov), Enterra’s website (www.enterraenergy.com) or by contacting Enterra. Furthermore, the forward looking statements contained in this news release are made as of the date of this news release, and Enterra 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 expressly required by securities law.
SOURCE Enterra Energy Trust