The Company has not released its audited 2012 results and accordingly the numbers included below are currently estimates and are unaudited.
-- Based on field estimates, fourth quarter 2012 average production increased 46% from the third quarter average to 3,100 boepd (96% oil) which is 10% ahead of previous guidance of 2,800 boepd.-- Based on field estimates, exit production for the period of December 15 to 31 was greater than 4,000 boepd which exceeded our previous exit guidance of 3,700 boepd by 8%.
Raging River is in the midst of a very active first quarter in which we anticipate drilling 30-32 net wells. We currently have three drilling rigs operating and have drilled 20 gross (17.5 net) wells at 100% success in January. Thirteen of these wells have been completed and placed on production. Despite winter operations which typically marginally increase costs, the average on-stream costs in January have been approximately $910 thousand, equivalent to summer 2012 costs.
The Kindersley area is prone to early break-up and operations typically shut down on or before March 15th. We plan to have all first quarter operations completed by March 6th and we are on schedule to complete this. The winter has seen significant snowfall to date increasing the probability of a pro-longed break-up. We have accounted for this in 2013 planning and have factored in no drilling activity between March 7th and June 1, 2013.
2013 production to date is exceeding expectations and we are confident we will meet or exceed our average first quarter estimates of 4,300 boepd (95% oil).
Raging River's experienced management team remains committed to operational and executional excellence to continue delivering per share value growth to our shareholders while maintaining balance sheet strength.
Additional corporate information can be found in our February corporate presentation on our website at www.rrexploration.com.
FORWARD LOOKING STATEMENTS: This press release contains forward-looking statements. More particularly, this press release contains statements concerning the anticipated terms relating to: average daily production for Q4 of 2012, estimated December 31, 2012 exit production, anticipated first quarter 2013 average production, 2013 drilling plans, the Company's drilling inventory, average on-stream costs of wells placed on production in the first quarter of 2013, the expected timing of completion of capital operations, the anticipated date of break up on certain of the Company's properties, Raging River's growth strategy and anticipated growth plans for 2013 and beyond. In addition, the use of any of the words "guidance", "initial, "scheduled", "can", "will", "prior to", "estimate", "anticipate", "believe", "potential", "should", "unaudited", "forecast", "future", "continue", "may", "expect", "project", and similar expressions are intended to identify forward-looking statements. The forward-looking statements contained herein are based on certain key expectations and assumptions made by the Company, including but not limited to the success of optimization and efficiency improvement projects, the availability of capital, current legislation, receipt of required regulatory approval, the success of future drilling and development activities, the performance of existing wells, the performance of new wells, the ability of the Company to effectively manage price differentials, Raging River's growth strategy, general economic conditions, availability of required equipment and services and prevailing commodity prices. Although the Company believes that the expectations and assumptions on which the forward-looking statements are based are reasonable, undue reliance should not be placed on the forward-looking statements because the Company 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. Actual results could differ materially from those currently anticipated due to a number of factors and risks. These include, but are not limited to, risks associated with the oil and gas industry in general (e.g., operational risks in development, exploration and production; delays or changes in plans with respect to exploration or development projects or capital expenditures; the uncertainty of reserve estimates; the uncertainty of estimates and projections relating to production, costs and expenses; and health, safety and environmental risks), commodity price and exchange rate fluctuations, changes in legislation affecting the oil and gas industry and uncertainties resulting from potential delays or changes in plans with respect to exploration or development projects or capital expenditures. Refer to the Listing Application on SEDAR at www.sedar.com and risks contained therein.
The forward-looking statements contained in this press release are made as of the date hereof and the Company undertakes no obligation 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.
Net Asset Value per Share: Net asset value per share as presented herein is based on the PVBT10 of proven plus probable reserves as at December 31, 2012 of $423 million, an internal estimate of Raging River's undeveloped land value of $40 million, estimated 2012 year end net debt of $17 million, dilutive securities proceeds of $41 million for total net asset value of $487 million and with 177.4 million shares outstanding on a fully diluted basis a net asset value per share of $2.75/share
Meaning of "boe": When used in this press release, boe means a barrel of oil equivalent on the basis of 1 boe to 6 thousand cubic feet of natural gas. Boe per day means a barrel of oil equivalent per day. Boe's may be misleading, particularly if used in isolation. A boe conversion ratio of 1 boe for 6 thousand cubic feet of natural gas is based on an energy equivalency conversion method primarily applicable at the burner tip and does not represent a value equivalency at the wellhead. As the value ratio between natural gas and crude oil based on the current prices of natural gas and crude oil 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.
NEITHER THE 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.
Raging River Exploration Inc.
Mr. Neil Roszell
President and CEO
Raging River Exploration Inc.
Mr. Jerry Sapieha, CA
Vice President, Finance and CFO