Canadian Superior Energy issued an update on its operational plans, activities and results.
- After declining to a Q1 average of 2,779 boe/d, Company production increased to 3,127 boe/d for the week ending May 19, under-pinned by a significant oil and gas discovery in the Eaglesham Wabamun trend, which came online in May producing 2.4 mmcf/d and 100 bbls/d.
- Highlighting management's expectation that production growth will continue in Q3, in early May the Company began completion and/or tie-in operations on 23 previously-suspended wells, including a new well at Westerose testing from combined Mannville-Glauc-Ellerslie zones at a combined rate exceeding 4 mmcf /d.
- Particularly encouraging from the winter program is a nearly 25% increase to the Company's daily liquids production, highlighting the potential management sees for positive near-term growth in Company-wide oil and condensate production.
- In Tunisia, the Company signed a rig commitment agreement to take operational possession of the ENSCO 105 jack-up rig during the fourth quarter of 2010 for drilling the Zarat 1-North appraisal well on the 7th of November Block.
- In Trinidad, the Company began evaluation of 7 new offshore lease blocks that will be offered for bid in August.
- The Liberty LNG regassification project is on budget and moving forward with submission of a construction permit planned for late August of this year. The Company continues to pursue possible joint ventures related to this project.
Second Half 2010 Plans and Strategy
The Company is committed to increasing shareholder value on its nearly 400,000 gross acres of Western Canada holdings, with strong emphasis on growing high-value oil and condensate production. After a thorough review of these assets, management has identified an extensive list of behind-pipe, infill and step-out locations capable of supporting a multi-year development and growth program. The latter half of 2010 is expected to mark the beginning of a substantial increase in Western Canada development and exploration activity, with a three-part strategy focused on core properties at Drumheller, Kaybob-Windfall and Boundary Lake-Eaglesham:
- Development of high value, low-risk/low-finding and development costs behind-pipe and infill reserves to increase cash flow in support of our Canada and international growth programs, and to increase the value of proved and probable reserves (gas-oriented). Management has identified approximately 60 locations that will be targeted in 2010 and during the first half of 2011, with potential for adding 1,600 boe/d in new production.
- Growth in liquids production through re-development of existing oil pools, with a focus on the Mannville "I" pool at Drumheller. Included in this program are plans for re-stimulating low-rate or suspended wells, infill drilling using horizontal wells and multi-stage frac technology, and initiation of a waterflood program.
- Growth in liquids production through exploration for and exploitation of oil resource plays on existing lands. Included in this program are "proof-of-concept" re-entry's of suspended wells owned by the Company, followed by infill and step-out drilling where successful.
The Company is committed to capturing the high-impact growth potential of its Tunisia/Libya and Trinidad/Tobago offshore oil and gas assets, and its Liberty Natural Gas LNG project on the US East Coast. Proposed plans for 2010 and the first half of 2011 include:
- Drilling of the Zarat 1-North appraisal well (offshore Tunisia) in late Q4, with potential for significant value and reserve additions given success.
- Participation in development plans for our offshore Trinidad assets as commissioned by our Operator partner for the block.
- Submission of construction permits by Liberty Natural Gas with respect to the Liberty LNG regassification project expected by late August, 2010.