Abraxas Announces Acceleration of 2017 Planned Activity; Updates CAPEX and Production Guidance
Abraxas Petroleum Corporation (“Abraxas” or the “Company”) (NASDAQ:AXAS)
today announced the acceleration of the Company’s 2017 planned activity
and updated the Company’s 2017 CAPEX and production guidance.
Acceleration of 2017 Planned Activity and Guidance
Update
Recognizing the success of the Caprito 99-101H, Abraxas’ Board of
Directors recently approved an increase in Abraxas’ 2017 capital budget
from $60 million to $110 million. This will allow Abraxas to run a full
time development rig on the Company’s Delaware Basin assets during 2017.
As previously announced, Abraxas plans to spud the Company’s first two
wells, the Caprito 98-201H and Caprito 98-301H, in February 2017.
Following these two wells, Abraxas plans to drill and complete an
additional five gross (four net) wells for a total of seven gross (six
net) wells across the Company’s Delaware Basin assets in 2017. Abraxas
also plans to expand the Company’s acreage position in the Delaware
Basin, and has dedicated approximately $15 million to acquiring
additional leasehold interests in the play. The Company expects to fund
this increase in its capital budget through cash on hand, availability
under its credit facility and through equity or debt financing
transactions, to the extent available on terms acceptable to the Company.
In the Bakken/Three Forks, Abraxas recently elected to participate in
four non-operated wells with a 26% working interest offsetting the
Company’s existing operated assets in the North Fork area. Abraxas is
maintaining the Company’s original operated drilling budget in this
area. As a reminder, this budget calls for drilling and completing eight
gross (five net) operated wells in 2017 and the drilling of an
additional three gross (two net) operated wells that will be completed
in 2018.
At Jourdanton, Abraxas’ capital budget has increased by $0.5 million in
connection with the planned drilling of two gross (two net) wells
targeting the Austin Chalk.
Abraxas forecasts this increase in activity will lead to average
production of 8,200 boepd at the midpoint of updated 2017 guidance with
a 2017 exit rate of approximately 9,500 boepd. The 2017 capital
expenditure budget is subject to change depending upon a number of
factors, including the availability of drilling equipment and personnel,
economic and industry conditions at the time of drilling, prevailing and
anticipated prices for oil and gas, the availability of sufficient
capital resources for drilling prospects, the Company’s financial
results, the availability of leases on reasonable terms and the ability
of the Company to obtain permits for drilling locations.
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2017E
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Low
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High
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Production
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Total (Boepd)
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7,800
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8,600
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% Oil
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66%
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% NGL
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12%
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% Natural Gas
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22%
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Operating Costs
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LOE ($/Boe)
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$6.00
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$8.00
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Production Tax (% Rev)
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8.0%
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10.0%
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Cash G&A ($mm)
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$10.0
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$12.5
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CAPEX ($mm)
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$110
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2017E
Net CAPEX
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($mm)
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Basin/Region
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Permian
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$52.5
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Bakken
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42.2
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Austin Chalk
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11.0
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Leasing/acquisitions/other
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4.3
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Total
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$110.0
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Bob Watson, President and CEO of Abraxas, commented, “We are very
pleased with the results of our first Wolfcamp completion in the
Delaware Basin. Given the economics associated with this well, our Board
of Directors elected to increase our capital budget to $110 million in
order to run a full time rig on our leasehold in 2017. We anticipate
this will lead to an exit rate of over 9,500 Boepd in 2017 while
allowing us to further derisk the multiple prospective horizons across
our Delaware Basin leasehold. We look forward to updating the street as
we execute on our drilling program and expand our acreage position in
this highly economic play.”
Abraxas Petroleum Corporation is a San Antonio based crude oil and
natural gas exploration and production company with operations across
the Rocky Mountains, Permian Basin and South Texas in the United States.
Safe Harbor for forward-looking statements: Statements in this release
looking forward in time involve known and unknown risks and
uncertainties, which may cause Abraxas’ actual results in future periods
to be materially different from any future performance suggested in this
release. Such factors may include, but may not be necessarily limited
to, changes in the prices received by Abraxas for crude oil and natural
gas. In addition, Abraxas’ future crude oil and natural gas production
is highly dependent upon Abraxas’ level of success in acquiring or
finding additional reserves. Further, Abraxas operates in an industry
sector where the value of securities is highly volatile and may be
influenced by economic and other factors beyond Abraxas’ control. In the
context of forward-looking information provided for in this release,
reference is made to the discussion of risk factors detailed in Abraxas’
filings with the Securities and Exchange Commission during the past 12
months.
View source version on businesswire.com: http://www.businesswire.com/news/home/20170119006101/en/
Copyright Business Wire 2017
Source: Business Wire
(January 19, 2017 - 4:01 PM EST)
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