JED Oil Steen River Reserves Prove Valuable
JED Oil Inc. announced its independent reserve report at December 31, 2007 for the Steen River area prospects and its year-end production exit rate, plus updated its drilling report and revised its guidance for the first and second quarters of 2008.
JED announced that the independent engineering firm of C G Engineering Ltd. has completed the report of JED's estimated reserves and net present value at December 31, 2007 for the Steen River area prospects in northern Alberta. The reserves represent 95% of the working interests in this area acquired last year from the former Caribou Resources Corp., as JED has sold 5% of its working interest effective December 1, 2007 to an arms-length third party.
"We are very pleased that the reserve report confirms our opinion of the value of the Steen River area prospects," stated JED's President, James Rundell. "The value of approximately CD$108.9 million of proved reserves alone (discounted 10%) for the Steen area is over 3.75 times JED's engineered value of proved reserves (at constant pricing discounted 10%) of $28.9 million at December 31, 2006."
JED exited the year with daily production of 2,108 Boe's, of which approximately 65% is oil. JED has completed drilling five Keg River oil wells of its winter drilling program of fifteen wells, ten targeting Keg River oil and five targeting Slave Point natural gas. Currently three of those five wells are tied-in and on production, and JED's completion and tie-in program will recommence on January 5, 2008. A sixth well is currently being drilled.
During 2007, JED also completed additional infrastructure in the Steen River area prospects which will permit year-round access to its oil wells.
On November 14, 2007, JED published guidance for December 31, 2007 of a range between 2,000 and 2,800 Boe/d, based on 75% to 100% of the Steen River assets. At December 31st, JED retained 95% of those assets. The proposed sales of the West Ferrier, Wizard Lake and Midale assets were not completed in 2007.
Accordingly, JED has revised its guidance for the exit rate at March 31, 2008 to a range of 3,569 to 2,818 Boe/d (depending on if it keeps 95% of the Steen assets or sells up to an additional 20%), and an exit rate range of 3,398 to 2,683 Boe/d for June 30, 2008.
- JED Not Happy with Remaining Bids for Alberta Assets, Mulls Options (Jan 14)
- JED Oil Files 4th Default Status Report, Closes Asset Sale (Dec 31)
- JED Oil Raises $4MM by Selling Ferrier, Wizard Lake Assets (Dec 10)