CALGARY, ALBERTA -- (Marketwired) -- 04/23/13 -- Alexander Energy Ltd. ("Alexander" or the "Company") (TSX VENTURE: ALX) announces that it has filed its Audited Financial Statements and related Management's Discussion and Analysis for the year ended December 31, 2012, along with other disclosure documents for 2012, all of which are available on the Company's profile at www.SEDAR.com ("SEDAR").
Message to Shareholders
Alexander Energy Ltd. has made consistent progress since the September, 2012 Annual General Meeting; we have a new CEO, Jim Sanden, and a new COO, David Oginski. All of our people are motivated and working diligently. The Company has had drilling and workover success, production and cash flow are up, the debt to cash flow ratio is decreasing, and our share price has increased.
Alexander's December, 2012 production averaged 929 barrels of oil equivalent per day (48 % oil), an increase of 263 barrels of oil equivalent per day or 30% over average third-quarter 2012 production.
As announced by the Company in its press release of March 4, 2013, at December 31, 2012, the Company had an 8% increase in the value of proved plus probable reserves (NPV 10%) to $35.5 million notwithstanding the lower price deck of forecast commodity prices. The Company replaced 169% of 2012 production on a proved plus probable basis. A summary of the McDaniel Report, and additional oil and gas information, is contained in the Company's 51-101F1 report included with the Company's year- end filings on SEDAR. The estimated future net revenue and NPV's contained in the McDaniel Report does not necessarily represent the fair market value of the Company's reserves.
In Q4 2012 and Q1 2013 the Company drilled and cased three Detrital sand oil wells on its Alexander property at an average working interest ("WI") of 89%:
-- The 15-12-56-27W4 well was put on-stream in December, 2012 at the rate of 69 bbl/day of oil (65 bbl/day net) and 100 mcf/day of natural gas (94 mcf/day net). Alexander WI - 94%.-- The 7-7-56-26W4 well was completed in March, 2013 and flow tested at the rate of 81 bbl/day (64 bbl/day net) and 70 mcf/day of natural gas (55 mcf/day net). Alexander WI - 79%.-- The 12-12-56-27W4 well was drilled in March, 2013 and well logs indicate three meters of excellent Detrital oil pay. The 12-12 well will be completed and tested immediately after spring breakup. Alexander WI - 94%.
There are several projects Alexander expects to complete during the balance of 2013. All of these projects should add significant value:
-- Oil Treating - currently the Company is trucking oil 120 km and paying to remove and dispose the associated water. We have identified modifications to our treating facilities that will enable us to sell clean oil to any of several terminals in our area. We expect a decrease in trucking and treating costs, and an increase in the sales price for our oil.-- Detrital wells - the Company expects to drill at least two additional Detrital oil wells during the balance of 2013. The locations are seismically defined and if successful will add reserves and production.-- New Lands - the Company has recently acquired additional lands and 3D seismic east of and adjacent to our current Alexander area lands. Further 3D seismic shooting and reprocessing is expected to be carried out in 2013 to determine if the Detrital oil pool extends onto these lands.-- Basal Quartz Production - We currently drill through the BQ sands that are situated uphole of the Detrital zone. We have many producing Detrital oil wells that show BQ oil on logs. Alexander is examining ways to evaluate the productive capacity of this zone - a horizontal well, dual completions or a vertical drilling program.