Twenty-three kilometres of 2D seismic has been acquired and interpreted during the period and preparations are under way to drill an RK Field development well to approximately 1,800 metres. Pending the results of this well, additional wells may be drilled to further develop the field.
A test of the legacy Yab-2 well was completed in 2012. The test indicated the presence of higher quality gas than seen in the RK Field. However, the well was not completed due to mechanical issues within the legacy wellbore.
Approximately 25.6 kilometers of 2D seismic was acquired on the Uzhgorod block during the period. The data has been interpreted and indicates a potential drilling location on the acreage; additional seismic is required to completely define the prospect and drilling location.
Cub's 2013 work programme is fully financed and the Company is well positioned to build on its operational successes achieved in 2012.
Cub intends to drill nine to ten wells (6 in the East and 3-4 in the West) and will workover or recomplete six wells on the Company's Eastern Ukraine assets. As a result of these projects and from bringing production on-stream from the 2012 CAPEX programme, management forecasts that the Company will exit 2013 with a production rate nearly double that of Cub's year-end 2012 rate.
The Company expects to close on its previously announced acquisition of three additional licences in Eastern Ukraine in the second quarter of 2013 and plans to begin a 3D seismic programme on these new licences in the third quarter of 2013.
About Cub Energy Inc.
Cub Energy Inc. (TSX VENTURE: KUB) is an upstream oil and gas company with 110,000 net acres in nine exploration and production licences within the two major producing basins of Ukraine. The Company's strategy is to implement western technology and capital, combined with local expertise and ownership, to increase value in its undeveloped land base, creating and further building a portfolio of producing oil and gas assets within a high pricing environment.
Oil and Gas Equivalents
Production information is commonly reported in units of barrel of oil equivalent ("boe" or "Mboe" or "MMboe") or in units of natural gas equivalent ("Mcfe" or "MMcfe" or "Bcfe"). However, boe(s) or Mcfe(s) may be misleading, particularly if used in isolation. A boe conversion ratio of 6 Mcf = 1 barrel, or a Mcfe conversion ratio of 1 barrel = 6 Mcf, is based on an energy equivalency conversion method primarily applicable at the burner tip and does not represent a value equivalency at the wellhead.
Except for statements of historical fact, this news release contains certain "forward-looking information" within the meaning of applicable securities law. Forward-looking information is frequently characterized by words such as "plan", "expect", "project", "intend", "believe", "anticipate", "estimate" and other similar words, or statements that certain events or conditions "may" or "will" occur. Cub believes that the expectations reflected in the forward-looking information are reasonable; however there can be no assurance those expectations will prove to be correct. We cannot guarantee future results, performance or achievements. Consequently, there is no representation that the actual results achieved will be the same, in whole or in part, as those set out in the forward-looking information.
Forward-looking information is based on the opinions and estimates of management at the date the statements are made, and are subject to a variety of risks and uncertainties and other factors that could cause actual events or results to differ materially from those anticipated in the forward-looking information. Some of the risks and other factors that could cause the results to differ materially from those expressed in the forward-looking information include, but are not limited to: general economic conditions in the Ukraine and globally; industry conditions, including fluctuations in the prices of natural gas; governmental regulation of the natural gas industry, including environmental regulation; unanticipated operating events or performance which can reduce production or cause production to be shut in or delayed; failure to obtain industry partner and other third party consents and approvals, if and when required; competition for and/or inability to retain drilling rigs and other services; the availability of capital on acceptable terms; the need to obtain required approvals from regulatory authorities; stock market volatility; volatility in market prices for natural gas; liabilities inherent in natural gas operations; competition for, among other things, capital, acquisitions of reserves, undeveloped lands, skilled personnel and supplies; incorrect assessments of the value of acquisitions; geological, technical, drilling, processing and transportation problems; changes in tax laws and incentive programs relating to the natural gas industry; failure to realize the anticipated benefits of acquisitions and dispositions; and the other factors. Readers are cautioned that this list of risk factors should not be construed as exhaustive.
This cautionary statement expressly qualifies the forward-looking information contained in this news release. We undertake no duty to update any of the forward-looking information to conform such information to actual results or to changes in our expectations except as otherwise required by applicable securities legislation. Readers are cautioned not to place undue reliance on forward-looking information.
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.
Cub Energy Inc.
Lionel C. McBee
Director of Investor Relations
Cub Energy Inc.
Chairman and Chief Executive Officer
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