Gentry Resource's production for the fourth quarter 2008 averaged 4,528 boe/d compared to 4,226 boe/d in the third quarter of 2007. For the month of December 2007, production averaged 4,809 boe/d.
Target production volumes for 2008 are approximately 5,100 boe/d which include an estimate of three percent downtime for plant outages. Production is expected to average approximately 5,000 boe/d in the first half, then ramp up to approximately 5,400 boe/d in the fourth quarter. Oil volumes should increase to approximately 55% of production, up from the current 43%, by year end as drilling continues to emphasize oil projects. These higher volumes are expected to carry over into the following year providing a strong start to 2009. These 2008 volumes do not reflect any acquisitions or dispositions.
The 2008 forecast is based on average commodity pricing for natural gas of $7.00 AECO per thousand cubic feet and an average crude oil price of USD $80.00 WTI per barrel. The forecast CAD/USD foreign exchange rate is 1:1. Year end debt is anticipated to be approximately $63 million, yielding a projected year end debt to estimated 2008 funds flow of less than 1.5:1. With January 2008 production of 5,000 boe/d, the company estimates 2008 capital efficiency of $25,000 per boe/d.
Gentry has entered into a zero premium collar to hedge 500 bbls/d of oil production. The floor of this collar is USD $85/bbl and the ceiling $104/bbl WTI. The term is from March 1 through to December 31, 2008. The company has also entered into a gas swap for 4,000 GJs/d of gas at $7.51/GJ AECO price. The term is from April 1 through to October 31, 2008.
Most Popular Articles