Journey Energy Inc. Provides Update on Encouraging Results from Two New Duvernay Wells
Journey Energy has reported encouraging results from its Duvernay Joint Venture operations, where it holds a 31.38% working interest across 104 sections. Two wells drilled from the 05-18-042-03W5 surface location have shown excellent initial test rates. The 03-26-042-04W5 well and 09-05-042-03W5 well, completed with 71 and 74 stages respectively, began flowing on November 25, 2024.
The wells have demonstrated strong 30-day production rates, with the 09-05 well producing 865 bbls/d of oil and the 03-26 well producing 1,019 bbls/d, both significantly exceeding internal type curve expectations. Production rates are materially better than previous wells drilled in 2018 and 2019, leading to increased type curve expectations for Duvernay wells.
The Joint Venture's initial gross capital expenditures are capped at $30 million for 2024 and $100 million for 2025. Journey plans to participate in 6-8 wells in 2025, with majority being drilled from three well pads to maximize efficiency.
Journey Energy ha riportato risultati incoraggianti dalle sue operazioni nella Joint Venture Duvernay, dove detiene un interesse lavorativo del 31,38% su 104 sezioni. Due pozzi perforati dalla posizione superficiale 05-18-042-03W5 hanno mostrato eccellenti tassi di prova iniziali. I pozzi 03-26-042-04W5 e 09-05-042-03W5, completati con rispettivamente 71 e 74 fasi, hanno iniziato a produrre il 25 novembre 2024.
I pozzi hanno dimostrato forti tassi di produzione nei primi 30 giorni, con il pozzo 09-05 che produce 865 bbl/d di petrolio e il pozzo 03-26 che produce 1.019 bbl/d, entrambi superando significativamente le aspettative interne del modello di riferimento. I tassi di produzione sono sostanzialmente migliori rispetto ai pozzi perforati nel 2018 e 2019, portando a un aumento delle aspettative per i pozzi Duvernay.
Le spese in conto capitale lorde iniziali della Joint Venture sono limitate a 30 milioni di dollari per il 2024 e a 100 milioni per il 2025. Journey prevede di partecipare a 6-8 pozzi nel 2025, con la maggior parte dei pozzi che saranno perforati da tre piattaforme per massimizzare l'efficienza.
Journey Energy ha informado resultados alentadores de sus operaciones en la Joint Venture Duvernay, donde posee un interés de trabajo del 31.38% en 104 secciones. Dos pozos perforados desde la ubicación superficial 05-18-042-03W5 han mostrado excelentes tasas de prueba inicial. El pozo 03-26-042-04W5 y el pozo 09-05-042-03W5, completados con 71 y 74 etapas respectivamente, comenzaron a fluir el 25 de noviembre de 2024.
Los pozos han demostrado fuertes tasas de producción de 30 días, con el pozo 09-05 produciendo 865 bbl/d de petróleo y el pozo 03-26 produciendo 1,019 bbl/d, ambos superando significativamente las expectativas internas del modelo de referencia. Las tasas de producción son materialmente mejores que los pozos perforados en 2018 y 2019, lo que lleva a un aumento en las expectativas del modelo de referencia para los pozos Duvernay.
Los gastos de capital brutos iniciales de la Joint Venture están limitados a 30 millones de dólares para 2024 y a 100 millones para 2025. Journey planea participar en 6-8 pozos en 2025, siendo la mayoría perforados desde tres plataformas para maximizar la eficiencia.
Journey Energy는 104개 섹션에서 31.38%의 작업 지분을 보유한 Duvernay 합작 투자 운영에서 긍정적인 결과를 보고했습니다. 05-18-042-03W5 지점에서 굴착된 두 개의 우물은 우수한 초기 시험 비율을 보여주었습니다. 03-26-042-04W5 우물과 09-05-042-03W5 우물은 각각 71단계와 74단계로 완공되었으며, 2024년 11월 25일부터 생산을 시작했습니다.
이 우물들은 30일 생산률이 강력하게 나타났으며, 09-05 우물은 하루에 865 배럴의 석유를 생산하고, 03-26 우물은 하루에 1,019 배럴을 생산하여 내부 유형 곡선 기대치를 상당히 초과했습니다. 생산률은 2018년과 2019년에 굴착된 예전 우물들보다 현저히 개선되어 Duvernay 우물에 대한 기대 증가로 이어졌습니다.
합작 투자의 초기 총 자본 지출은 2024년에 3천만 달러, 2025년에 1억 달러로 제한됩니다. Journey는 2025년에 6-8개의 우물에 참여할 계획이며, 대부분은 효율성을 극대화하기 위해 세 개의 우물 플랫폼에서 굴착 될 예정입니다.
Journey Energy a rapporté des résultats encourageants de ses opérations dans la Joint Venture Duvernay, où elle détient un intérêt de travail de 31,38 % sur 104 sections. Deux puits forés à partir de l'emplacement en surface 05-18-042-03W5 ont montré d'excellents taux de tests initiaux. Le puits 03-26-042-04W5 et le puits 09-05-042-03W5, achevés avec respectivement 71 et 74 étapes, ont commencé à produire le 25 novembre 2024.
Les puits ont démontré de fortes taux de production au cours des 30 premiers jours, le puits 09-05 produisant 865 barils/jour de pétrole et le puits 03-26 produisant 1 019 barils/jour, dépassant tous deux de manière significative les attentes internes du modèle de référence. Les taux de production sont nettement supérieurs à ceux des puits forés en 2018 et 2019, entraînant une augmentation des attentes de modèle pour les puits Duvernay.
Les dépenses en capital brutes initiales de la Joint Venture sont plafonnées à 30 millions de dollars pour 2024 et à 100 millions de dollars pour 2025. Journey prévoit de participer à 6-8 puits en 2025, la majorité étant forée depuis trois plateformes de forage afin de maximiser l'efficacité.
Journey Energy hat ermutigende Ergebnisse aus seinen Duvernay-Joint-Venture-Operationen gemeldet, wo es einen Arbeitsanteil von 31,38% über 104 Abschnitte hält. Zwei von der Oberfläche 05-18-042-03W5 gebohrte Brunnen haben hervorragende anfängliche Testraten gezeigt. Der Brunnen 03-26-042-04W5 und der Brunnen 09-05-042-03W5, die jeweils mit 71 und 74 Stufen abgeschlossen wurden, begannen am 25. November 2024 zu fließen.
Die Brunnen haben starke Produktionsraten in den ersten 30 Tagen gezeigt, wobei der Brunnen 09-05 865 bbl/d Öl und der Brunnen 03-26 1.019 bbl/d produziert, beide weit über den internen Typkurvenerwartungen. Die Produktionsraten sind materiell besser als die zuvor in 2018 und 2019 gebohrten Brunnen, was zu einer Erhöhung der Typkurvenerwartungen für Duvernay-Brunnen führt.
Die initialen Bruttoinvestitionen der Joint Venture sind auf 30 Millionen US-Dollar für 2024 und 100 Millionen US-Dollar für 2025 begrenzt. Journey plant, 2025 an 6-8 Brunnen teilzunehmen, wobei die Mehrheit von drei Bohrplattformen aus gebohrt wird, um die Effizienz zu maximieren.
- Strong initial production rates: 1,019 bbls/d and 865 bbls/d of oil from the two wells
- Drilling and completion costs projected to be well below original estimates
- High oil and NGL content (87-90%) in production mix
- Expected booking of 40 gross (12 net) additional proved plus probable offset locations
- Production rates significantly exceeding internal type curve expectations
- Substantial capital expenditure commitments: $30M in 2024 and $100M in 2025
Calgary, Alberta--(Newsfile Corp. - January 6, 2025) - Journey Energy Inc. (TSX: JOY) (OTCQX: JRNGF) ("Journey" or the "Company") is pleased to provide an update on its Duvernay Joint Venture (the "Joint Venture") operations, including the excellent initial test rates achieved by the first two wells.
Duvernay Joint Venture Operational Update
On May 7, 2024 Journey announced its participation in a 128 section, Joint Venture in the Duvernay. Journey's current working interest in the Joint Venture is
Two Joint Venture wells have been drilled to date from the 05-18-042-03W5 surface location. The 03-26-042-04W5 well has a stimulated lateral length of 3,511 meters and was completed with 71 stages involving 6,395 tonnes of sand. The 09-05-042-03W5 well has a stimulated lateral length of 3,650 meters and was completed with 74 stages involving 6,582 tonnes of sand. Both wells were tied into the Journey operated gas processing facility at 01-04-042-03W5 and began flowing through testers on November 25, 2024. Individual well drilling and completion costs (excluding testing and surface facility costs) are projected to be well below the originally estimated costs.
Production Summary:
| 09-05-042-03W5/00 | 03-26-042-03W5/00 | |
| Total to Date: | ||
| Flowing Time (days)(1) | 30 | 30 |
| Oil (bbls/d) | 865 | 1,019 |
| Oil Gravity (⁰API) | 48 | 48 |
| Natural gas (mcf/d) | 800 | 700 |
| Natural gas liquids (bbls/d) | 31 | 28 |
| Barrels of oil equivalent (boe/d) | 1,029 | 1,166 |
| Per cent oil and NGL's |
(1) Production volumes in the table are based on Field Notes from Testers. These volumes represent the highest 30-day average rates achieved since November 25, 2024. Final reported volumes may differ from test volumes.
The above production rates continue to significantly exceed internal type curve expectations which were originally based upon the initial wells drilled and completed in 2019 by another operator. Both wells continue to be restricted.
Although these represent preliminary results, and comparisons with the original wells on the Joint Venture will be more representative in late January after 60 producing days, current oil flow rates are materially better than the flow rates of the original wells drilled in 2018 and 2019. This result has prompted an increase in Journey's type curve expectations for Duvernay wells with a stimulated lateral length of 3,600 meters. The new type curve features a small increase in recoverable reserves, but a more substantial increase in initial productivity rates. Because of this, Management expects this to result in a corresponding increase in the rate of return, and a decrease in the payout period from the on-production date. Shareholders are directed to Journey's December corporate presentation for updated type curves.
Journey's share of expenditures for the first two wells were primarily funded through the closing of the financing on March 20, 2024. Initial gross capital expenditures for the Joint Venture are capped at gross amounts of
Management believes they have found a quality Joint Venture partner to help benefit from the economies of scale while minimizing the risk of single events on the Company's business plan. Journey's working interest position in the Joint Venture is enough to support 60 net 2.5 mile wells on azimuth locations.
Future Update and Further Information
Journey's preliminary plans for the Joint Venture in 2025 are to participate in 6-8 wells (1.8-2.4 net). The majority of these locations will be drilled from three well pads in order to maximize operational efficiencies and minimize well costs. Journey plans to provide additional production data, full year capital, production, and adjusted funds flow guidance, and its funding plans toward the end of January 2025 as capital phasing and on-stream dates are currently being refined by the partners.
Journey management views 2025 as a pivotal year for the company as the groundwork laid in previous years begins to materialize. Journey's management remains focused on long-term value creation for all stakeholders and are available to address shareholder inquiries upon request.
About the Company
Journey is a Canadian exploration and production company focused on conventional, oil-weighted operations in Alberta, Canada. Journey's strategy is to grow its production base by drilling on its existing core lands, implementing secondary and tertiary flood projects on its existing lands, and by executing on accretive acquisitions. In conjunction with its joint venture partner, the Company has recently begun development of its Duvernay light oil resource play. In addition, Journey is continuing with its plans to grow its power generation business through its projects at Gilby and Mazeppa.
For further information contact:
Alex G. Verge
President and Chief Executive Officer
403-303-3232
alex.verge@journeyenergy.ca
or
Gerry Gilewicz
Chief Financial Officer
403-303-3238
gerry.gilewicz@journeyenergy.ca
Journey Energy Inc.
700, 517 - 10th Avenue SW
Calgary, AB T2R 0A8
403-294-1635
www.journeyenergy.ca
ADVISORIES
This press release contains forward-looking statements and forward-looking information (collectively "forward-looking information") within the meaning of applicable securities laws relating to the Company's plans and other aspects of the anticipated future operations, management focus, strategies, financial, operating and production results, industry conditions, commodity prices and business opportunities. In addition, and without limiting the generality of the foregoing, this press release contains forward-looking information regarding decline rates, anticipated netbacks, drilling inventory, estimated average drill, complete and equip and tie-in costs, anticipated potential of the Assets including, but not limited to, EOR performance and opportunities, capacity of infrastructure, potential reduction in operating costs, production guidance, total payout ratio, capital program and allocation thereof, future production, decline rates, funds flow, net debt, net debt to funds flow, exchange rates, reserve life, development and drilling plans, well economics, future cost reductions, potential growth, and the source of funding Journey's capital spending. Forward-looking information typically uses words such as "anticipate", "believe", "project", "expect", "goal", "plan", "intend" or similar words suggesting future outcomes, statements that actions, events or conditions "may", "would", "could" or "will" be taken or occur in the future.
The forward-looking information is based on certain key expectations and assumptions made by management, including expectations and assumptions concerning prevailing commodity prices and differentials, exchange rates, interest rates, applicable royalty rates and tax laws; future production rates and estimates of operating costs; performance of existing and future wells; reserve and resource volumes; anticipated timing and results of capital expenditures; the success obtained in drilling new wells; the sufficiency of budgeted capital expenditures in carrying out planned activities; the timing, location and extent of future drilling operations; the state of the economy and the exploration and production business; results of operations; performance; business prospects and opportunities; the availability and cost of financing, labour and services; the impact of increasing competition; the ability to efficiently integrate assets and employees acquired through acquisitions, including the Acquisition, the ability to market oil and natural gas successfully and the ability to access capital. Although we believe that the expectations and assumptions on which such forward-looking information is based are reasonable, undue reliance should not be placed on the forward-looking information because Journey can give no assurance that they will prove to be correct. Since forward-looking information addresses future events and conditions, by its very nature they involve inherent risks and uncertainties. The actual results, performance or achievement could differ materially from those expressed in, or implied by, the forward-looking information and, accordingly, no assurance can be given that any of the events anticipated by the forward-looking information will transpire or occur, or if any of them do so, what benefits that we will derive therefrom. Management has included the above summary of assumptions and risks related to forward-looking information provided in this press release in order to provide security holders with a more complete perspective on future operations and such information may not be appropriate for other purposes.
Readers are cautioned that the foregoing lists of factors are not exhaustive. Additional information on these and other factors that could affect the operations or financial results are included in reports on file with applicable securities regulatory authorities and may be accessed through the SEDAR website (www.sedarplus.ca). These forward-looking statements are made as of the date of this press release and we disclaim any intent or obligation to update publicly any forward-looking information, whether as a result of new information, future events or results or otherwise, other than as required by applicable securities laws.
This press release contains future-oriented financial information and financial outlook information (collectively, "FOFI") about Journeys prospective results of operations, funds flow, netbacks, debt, payout ratio well economics and components thereof, all of which are subject to the same assumptions, risk factors, limitations and qualifications as set forth in the above paragraphs. FOFI contained in this press release was made as of the date of this press release and was provided for providing further information about Journey's anticipated future business operations. Journey disclaims any intention or obligation to update or revise any FOFI contained in this press release, whether as a result of new information, future events or otherwise, unless required pursuant to applicable law. Readers are cautioned that the FOFI contained in this press release should not be used for purposes other than for which it is disclosed herein. Information in this press release that is not current or historical factual information may constitute forward-looking information within the meaning of securities laws, which involves substantial known and unknown risks and uncertainties, most of which are beyond the control of Journey, including, without limitation, those listed under "Risk Factors" and "Forward-Looking Statements" in the Annual Information Form filed on www.sedarplus.ca on March 28, 2024. Forward-looking information may relate to the future outlook and anticipated events or results and may include statements regarding the business strategy and plans and objectives. Particularly, forward-looking information in this press release includes, but is not limited to, information concerning Journey's drilling and other operational plans, production rates, and long-term objectives. Journey cautions investors in Journey's securities about important factors that could cause Journey's actual results to differ materially from those projected in any forward-looking statements included in this press release. Information in this press release about Journey's prospective funds flows and financial position is based on assumptions about future events, including economic conditions and courses of action, based on management's assessment of the relevant information currently available. Readers are cautioned that information regarding Journey's financial outlook should not be used for purposes other than those disclosed herein. Forward-looking information contained in this press release is based on current estimates, expectations and projections, which we believe are reasonable as of the current date. No assurance can be given that the expectations set out in the Prospectus or herein will prove to be correct and accordingly, you should not place undue importance on forward-looking information and should not rely upon this information as of any other date. While we may elect to, we are under no obligation and do not undertake to update this information at any particular time except as required by applicable securities law.
Drilling Locations: This press release refers to currently unbooked drilling locations. Unbooked locations are internal estimates based on the Company's prospective acreage and an assumption as to the number of wells that can be drilled per section based on industry practice and internal review. Unbooked locations do not have attributed reserves or resources. Unbooked locations have specifically been identified by management as an estimation of our multi-year drilling activities based on evaluation of applicable geologic, seismic, and engineering, production and reserves data on prospective acreage and geologic formations. The drilling locations on which we actually drill wells will ultimately depend upon the availability of capital, regulatory approvals, seasonal restrictions, oil and natural gas prices, costs, actual drilling results and other factors. While certain of the unbooked drilling locations have been derisked by drilling existing wells in relative close proximity to such unbooked drilling locations, the majority of other unbooked drilling locations are farther away from existing wells where management has less information about the characteristic of the reservoir and therefore there is more uncertainty whether wells will be drilled in such locations and if drilled there is more uncertainty that such wells will result in additional oil and gas reserves, resources or production.
Measurements
All dollar figures included herein are presented in Canadian dollars, unless otherwise noted.
Where amounts are expressed in a barrel of oil equivalent ("BOE"), or barrel of oil equivalent per day ("BOE/d"), natural gas volumes have been converted to barrels of oil equivalent at six (6) thousand cubic feet ("Mcf") to one (1) barrel. Use of the term BOE may be misleading particularly if used in isolation. The BOE conversion ratio of 6 Mcf to 1 barrel ("Bbl") of oil or natural gas liquids is based on an energy equivalency conversion methodology primarily applicable at the burner tip and does not represent a value equivalency at the wellhead. This conversion conforms to the Canadian Securities Regulators' National Instrument 51-101 - Standards of Disclosure for Oil and Gas Activities.
Oil and Gas Measures and Metrics
The Company uses the following metrics in assessing its performance and comparing itself to other companies in the oil and gas industry. These terms do not have a standardized meaning and therefore may not be comparable with the calculation of similar measures.by other companies:
- Corporate Decline is the rate at which production from a grouping of assets falls from the beginning of a fiscal year to the end of that year.
- IP 30 is the average daily production rate of a well in its first full calendar month of production expressed in boe's.
Select Abbreviations and Definitions
| bbl | barrel |
| bbls | barrels |
| GOR | gas to oil ratio |
| GORR | gross over-riding royalty |
| kPaG | Kilopascal gauge |
| m | meters |
| Mbbls | Thousand barrels |
| MMBtu | million British thermal units |
| NGLs | natural gas liquids |
| Mcf | thousand cubic feet at standard conditions |
| Mmcf | million cubic feet at standard conditions |
| Mmcf/d | million cubic feet per day at standard conditions |
| Boe | barrel of oil equivalent |
| Mboe | thousand boe |
| $M | thousands of dollars |
No securities regulatory authority has either approved or disapproved of the contents of this press release.
To view the source version of this press release, please visit https://www.newsfilecorp.com/release/236245
FAQ
What are the initial production rates of Journey Energy's (JRNGF) new Duvernay wells?
What is Journey Energy's (JRNGF) working interest in the Duvernay Joint Venture?
What are Journey Energy's (JRNGF) capital expenditure limits for the Duvernay Joint Venture in 2024-2025?
How many wells does Journey Energy (JRNGF) plan to drill in the Duvernay Joint Venture for 2025?
What is the expected impact of the new Duvernay wells on Journey Energy's (JRNGF) reserves?
