Tamarack Valley Energy, “Production Ahead of Forecast”

Tamarack Valley Energy (TSX:TVE) has announced that due to exceptional 2018 drilling results, current production is ahead of forecast. As a result, the company will provide its second guidance increase for 2018.

The company also announced that it will be added to the TSX Composite Index and its sub-indices effective September 24, 2018.

As quoted from the press release:

As a result of better than expected performance from its Alberta Viking drilling program thus far in 2018, production for the last four weeks has averaged over 25,000 boe/d based on field estimates. Tamarack expects third quarter 2018 production to average approximately 24,700 boe/d.

With the company’s continued out performance and operational success realized to date in 2018, Tamarack is pleased to increase production guidance for 2018 annual, 2018 exit and preliminary 2019 budget by 500 boe/d for each period with no corresponding change to the capital expenditure forecasts. Annual production guidance for 2018 has been increased to 24,000 to 24,500 boe/d (64 to 66 percent liquids), up from 23,500 to 24,000 boe/d, while 2018 fourth quarter exit production guidance has been increased to 24,500 to 25,000 boe/d (65 to 67 percent liquids), up from 24,000 to 24,500 boe/d. Tamarack’s 2018 capital budget remains unchanged from previous guidance at C$223 to C$233 million (including C$28.4 million of capital accelerated from 2019 into 2018) and is expected to be fully funded from adjusted operating field netback. Approximately half of the C$28 million of accelerated capital will be directed to the Veteran waterflood. Tamarack plans to drill nine new injector wells and to install the associated pipe and facilities to ensure water injection can commence by early 2019. In keeping with Tamarack’s capital allocation strategy, all of the planned Veteran waterflood projects are expected to achieve a 1.5 year payout based on current strip prices. The other half of the accelerated capital will be directed to initiate the Company’s Q1/19 drilling program in the fourth quarter, which includes de-risking lands located east of Veteran that were originally targeted for delineation in early 2019.

Annual average production volumes under its preliminary 2019 budget are increased to 25,500 to 26,500 boe/d (up from 25,000 to 26,000 boe/d) and assume a capital budget of C$222 million (originally C$250 million with C$28.4 million accelerated into 2018).

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