Current AAV Stock Info

Canada based Advantage Oil and Gas (ticker: AAV) is focused primarily on its Montney natural gas assets in Glacier, Alberta.

Advantage Oil and Gas: Spurring New Production in the Montney

Source: Advantage Oil and Gas LTD

The Montney assets produce approximately 235 Mscf/day, and Advantage’s 2P reserves were increased to 2.2 Tcfe as of December 31st, 2016.

1,100 future drilling locations should provide 245 Mmcfe/day for 50 years

Advantage has inventoried over 1,100 future well locations in the approximately 300 meter thick Montney, and expects that the shale play can maintain production of 245 Mmcfe/day for approximately 50 years.

Between July, 2008 and December 31st, 2016, the company has drilled 181 horizontal wells in its Glacier asset.

Advantage currently possesses 87 net sections of acreage close to its Glacier asset, which it intends to evaluate for production potential. Including the 87 net sections, Advantage holds a total of 178 net sections in the Montney shale—equivalent to approximately 113,920 net acres.

In Q1, 2017, Advantage added 24 net sections to its Progress field —equivalent to 15,360 net acres—for $6 million.

Benefits to Advantage derivatives

Advantage owns 100% working interest of the Glacier gas plant, which has a 260 Mmcf/day raw gas capacity, with a planned 400 Mmcf/day raw gas and 6,800 BOPD NGL expansion announced in 2016. Advantage’s ownership of its gas plant, as well as the distribution lines leading to the TransCanada pipeline grants it operating costs of approximately $0.25/Mcfe.

Growth for shareholders

From December 13th, 2013 to December 31st, 2016, Advantage showed a 98% total shareholder return. This compares to a 23% return from the S&P/TSX Composite Index, a -11% total return from the S&P/TSX Capped Energy Index, and a -18% total return from the S&P/TSX Exploration & Production GICS Sub Industry.

Advantage Oil and Gas: Spurring New Production in the Montney

Source: Advantage Oil and Gas LTD

In keeping with Advantage’s strong position, the company has outlined plans to grow its production by 56% from 2017 to 2019—an expansion from 221 Mmcfe/day to 325 Mmcfe/day. To accomplish this growth, Advantage reports that it will only need 83 of its 1,100 future drill locations in the Glacier area.

The future of Advantage’s gas

Advantage expects that the additional gas it will extract will find markets in North America, which Advantage believes will undergo a demand increase to approximately 9 Bcf/day between 2017 and 2021.

Advantage also believes that delays in U.S. pipeline construction in the Northeast will provide Canadian gas and gas transportation with a competitive advantage.

Advantage is presenting at EnerCom’s The Oil & Gas Conference®

Advantage Oil and Gas LTD will be a presenting company at the upcoming EnerCom conference in Denver, Colorado—The Oil & Gas Conference® 22.

The conference is EnerCom’s 22nd Denver-based oil and gas focused investor conference, bringing together publicly traded E&Ps and oilfield service and technology companies with institutional investors.  The conference will be at the Denver Downtown Westin Hotel, August 13-17, 2017. To register for The Oil & Gas Conference® 22 please visit the conference website.


Legal Notice