Tango Energy's 2007 average production rate is expected to be about 700 barrels of oil equivalent per day ("boepd") compared with approximately 330 boepd for 2006. The 16-14 well at Cecilia was drilled in the fourth quarter of 2007 and placed on stream in mid December at a production rate of approximately 60 boepd net to the company. Tango also drilled a well at Deanne during the fourth quarter of 2007 which is anticipated to be tied-in by the end of the June, 2008. Tango's recent new pool discovery in Quaich was flow tested at just over 4 million cubic feet of gas per day (400 boepd net to Tango) and is expected to be tied in by Compton Petroleum Ltd., the operator, before the end of June, 2008. Tango and it's partner have also recently acquired additional crown petroleum and natural gas rights on this play and anticipates that this play shall attract a significant amount of Tango's 2008 capital budget.
Funds flow from operations for 2007 will be approximately $5.2 million and net debt at December 31, 2007 will be approximately $5.3 million. Tango currently has available a $9.5 million operating line of credit and a $2.75 million acquisition/development line of credit.
Tango plans to spend approximately $6.5 million on its 2008 capital program which contemplates a number of development and exploratory drilling opportunities in its core areas that could allow Tango to exit 2008 at approximately 1100 boepd. This capital program will be financed substantially from funds flow from operations but Tango expects to incur some additional debt to complete its planned programs with the result that it's debt to cash flow ratio is expected to increase to 1.4 at year end 2008. In it's forecast models Tango has used an average natural gas price forecast of $6.32/mcf for 2008. Tango will update shareholders quarterly or as results from operations require.
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