Bellamont Tags $7MM Capital Budget, Focuses on Peace River Arch Projects
Bellamont has approved a 2009 capital budget of $7 million. The Company plans to maintain its strong balance sheet by funding the 2009 capital program out of its existing working capital and projected 2009 cash flow. As of December 31, 2008, the Company had an estimated working capital surplus in excess of $4 million.
Bellamont's strategy is to build a low risk reserve, production and cash flow base through acquiring, developing and exploring primarily in the Peace River Arch Area of Alberta. Bellamont has a strong technically focused
management team that internally generates and develops high quality large resource based prospects. The Company has compiled an undeveloped land inventory of 67,479 gross acres (39,797 net), of which 45,916 gross acres (29,004 net) is located in the Peace River Arch area of Alberta.
Bellamont's 2009 capital program is heavily weighted to development projects in the Peace River Arch of Alberta. The Company expects to drill or recomplete 10 (6.3 net) wells and equip one well that was recompleted in 2008. The activity will be directed primarily towards lower risk follow-up wells to the Company's successful 2007 and 2008 discoveries. Two thirds of the capital has been scheduled for the second half of the year, taking advantage of anticipated lower service costs.
The Company's current production is approximately 650 boe per day with 100 boe per day behind pipe (~76% natural gas and 24% light oil). Bellamont expects to bring on a majority of the behind pipe production before spring break-up. The Company expects to produce an average of approximately 750 boe per day over the course of the year and exit greater than 800 boe per day.
Bellamont's 2009 budget maintains a strong balance sheet and unutilized line of credit of $7.25 million. With only one third of the capital budget scheduled for the first half of the year, Bellamont will have the financial
flexibility to pursue acquisition and exploration opportunities. Bellamont intends to maintain its discipline and concentrate on strategic opportunities that are accretive on cash flow, production and reserves on a per share basis, while maintaining a strong balance sheet.