Current RRX:CA Stock Info

Raging River Exploration Inc. (ticker: RRX) set a 2018 capital budget of $335 million. The budgeted capital expenditures are expected to increase annual average production in 2018 to 24,500 BOEPD (92% oil) with fourth quarter 2018 production estimated at 26,000 BOEPD, representing a fourth quarter to fourth quarter production per share growth of greater than 11%.

The 2018 capital budget approximates forecasted funds flow from operations of $328 million at WTI of US$55/bbl. The company expects an exit 2018 net debt of approximately $301 million, representing a 0.9 times net debt to forecasted 2018 funds flow from operations.

Duvernay light oil discovery update; buying more sections

Raging River’s $335 Million Budget Aims at 26,000 BOEPD in Q4 2018

RRX Light Oil Growth

On November 9, 2017, Raging River announced that the company successfully drilled and completed a Duvernay light oil discovery well (4-11) in the Ferrybank area of central Alberta. The 4-11 well was drilled and cased to a measured depth of 4,573 m and included a 2,200 m lateral section in the upper portion of the Duvernay formation. The 4-11 well was completed with a slick water, plug and perforate completion design, which included 43 stages over the lateral section.  Average sand placement over the lateral length was approximately 2 tons per meter.

Production testing operations commenced on November 6, 2017.

Raging River’s $335 Million Budget Aims at 26,000 BOEPD in Q4 2018

RRX 4-11 Duvernay Well Map

“We anticipated that first oil production would not be seen for several weeks, light oil (38o API) production was established within the first 24 hours of flow back,” Raging River said in a press release. “Testing operations were continued through to November 25th, at which point the decision was made to shut-in the well and equip it with artificial lift and surface facilities to allow gas conservation and continuous production operations.”

Over the first 30 days of production, the well cumulatively produced 5,550 bbls of oil or an average of 185 bbls/d.  The well continues to flow and pump with recent rates over the last 7 days averaging in excess of 225 bbls/d of light oil.  The well continues to produce at very low gas rates of 50-60 mcf/d equating to expected gas oil ratio of 250-300 scf/bbl.

Raging River’s $335 Million Budget Aims at 26,000 BOEPD in Q4 2018

RRX Duvernay Basin Map

As part of the slick water completion process, Raging River pumped in excess of 240,000 barrels of water. Throughout the testing phase and early production history of the well, water cuts have steadily decreased from 90% to the current water cut of 62%.

To date, approximately 9% of the total load water pumped into the formation has been recovered. The trend in decreasing water cuts is very similar to the trends observed in offsetting wells in the area, in which water cuts moderate over time as more and more of the load fluid is recovered with expected stabilization in the 10% to 25% range.

Raging River continues to expand its Duvernay land base and has added 10 net sections over the last 30 days increasing land position to approximately 243,000 acres (380 net sections) in the oil-prone portion of the Duvernay.

The initial/base plan estimates six evaluation wells in 2018, with three wells drilled the first quarter and completion activities late in the second quarter. The three initial tests will be delineation efforts with one well in the Ferrybank area, one well in the Pigeon Lake area and one well in the Gilby area.

2017 budget and operations update

  • Cooperative weather in November and early December
  • Guidance levels of $365 million and 22,750 BOEPD annual production average on-track
  • Approximately 335 Viking horizontal wells and one Duvernay horizontal well drilled in 2017
Raging River’s $335 Million Budget Aims at 26,000 BOEPD in Q4 2018

RRX 2018 Guidance

Approximately 75% or $250 million of the approved $335 million 2018 capital budget will be directed towards the development drilling of approximately 296 net Viking horizontal wells.  Given the continued strong performance of the extended reach horizontal (ERH) wells, approximately 60% of the 2018 wells will be drilled with an ERH well design.

For 2018, the company anticipates spending approximately $16 million on further advancing the Viking waterflood. Approximately $7 million of capital has been allocated to gas conservation and abandonments with the purpose of reducing methane emissions.

Raging River’s $335 Million Budget Aims at 26,000 BOEPD in Q4 2018

RRX Viking Position Map

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