Yangarra Provides Operations Update
October 22, 2015 – Yangarra Resources Ltd. (“Yangarra” or the “Company”) (TSX:YGR) provides an operations update.
Yangarra’s 3rd quarter capital program had significant cost reductions in both drilling and completion operations, as well as earning new lands. One of the Company’s 1.5 mile horizontal (“HZ”) wells drilled in the 2nd quarter, at a cost of $1.3 million, was fracked with 45 stages and 675 tonnes of sand and completed at a cost of $1.2 million. Initial Production over 30 days (“IP-30”) was 478 boe/d (including 378 bbls/d of oil).
Two additional wells drilled during the 2nd quarter (one 1 mile and one 1.5 mile) are scheduled to be completed in the 4th quarter when crown pipeline right of ways are secured, which are currently delayed by Aboriginal Consultation Office (“ACO”) approvals.
A 2 mile HZ well drilled in the 3rd quarter was completed early in the 4th quarter and is currently on flow-back after a 61 stage completion with 915 tonnes of sand. The well cost $1.8 million to drill and $1.5 million to complete.
Two 1 mile HZ wells have been drilled in the 4th quarter and will be completed and tied into the Company’s Ferrier compression facility in early November.
In late August the Company diverted shut in production from the TCPL James River system to the TCPL mainline. Shortly thereafter a portion of that production was unexpectedly shut in due to maintenance work by TCPL on the main line. In addition, the Company experienced several other interruptions at various facilities throughout the 3rd quarter as a result of rolling shutdowns by TCPL. As a result of the various outages, Yangarra’s average daily production was approximately 2,100 boe/d (50% oil & NGL’s) for the third quarter of 2015.
The Company expects fourth quarter 2015 production to average between 2,300 – 2,600 boe/d with continued TCPL interruptions.
Upon review of full cycle returns, Yangarra will focus on Cardium development. Well cost reduction initiatives and other technological advances are having significant positive impact to the risk adjusted returns. The Company’s experience in the Cardium also minimizes the risk profile.
Yangarra completed drilling its first Duvernay strata-graphic vertical test well on the 54 section North block, after analyzing the results and in the context of the current commodity environment, Yangarra has decided that the risk adjusted returns no longer justify further drilling in the North block and will let the block expire.
Yangarra intends to complete the standing horizontal well in the South Block in the summer of 2016 when processing capacity is expected to be available.
Yangarra`s corporate strategy for 2016 in the current commodity environment is to target and maintain 2,500 – 2,750 boe/d while spending within cash-flow at US$45/bbl WTI. Yangarra is preparing for future growth by acquiring significant Cardium acreage at very attractive prices, consolidating partner interests and securing infrastructure. The Company’s current inventory supports an ability to increase the pace of development to 2-3 drilling rigs when justified by full cycle returns.
An updated corporate presentation is available on the Company`s webpage at
Yangarra has appointed Frank Sur of Gowlings as corporate secretary, Frank replaces Jeff Dyck of Gowlings, and the Company thanks Jeff for his contribution and guidance over the past 5 years.
For further information, please contact Jim Evaskevich, President and CEO at (403) 262-9558.