CALGARY,
AB, Feb. 6, 2023 /CNW/ - Alvopetro Energy Ltd.
(TSXV: ALV) (OTCQX: ALVOF) announces January
2023 sales volumes, our February 1,
2023 natural gas price redetermination, our 2023 capital
plan and an operational update.
President and CEO, Corey
Ruttan commented:
"Building on our record year in 2022 we are looking forward
to our 2023 capital plan. Our focus this year is on adding
production and reserves from our lower risk development
opportunities. We have made the key infrastructure investments
necessary to realize the full potential from our Murucututu natural
gas project. This project has significant reserves and resources
and our goal is to unlock this potential with a multi-year
development plan starting this year."
January
2023 sales volumes
January sales volumes averaged 2,754 boepd,
including natural gas sales of 15.6 MMcfpd,
associated natural gas liquids sales (condensate) of 141 bopd,
and 5 bopd of oil sales, based on field estimates, a 1%
increase from our Q4 average daily volumes.
Operational Update and 2023
Capital Plans
Murucututu (100% Alvopetro)
On our Murucututu project, we expect to commence the stimulation
on our 197(1) well later this quarter. We have already completed
the work to tie-in this well to our 183(1) facility and expect to
commence production in the second quarter. We also plan to drill
two "fit-for-purpose" Gomo development wells in 2023. One of these
locations has additional uphole exploration potential in the
Caruaçu and Marfim Formations. Total capital expenditures of
$16 million are budgeted for
Murucututu in 2023.
Caburé (49.1% Alvopetro)
Our 2023 capital budget includes an expansion of the unit
facilities and drilling two additional development wells. Total
expenditures of $3 million are
budgeted for Alvopetro's share of 2023 capital expenditures on our
Caburé project.
Bom Lugar (100% Alvopetro)
In 2023, we plan to drill up to two development wells on our Bom
Lugar oil field, targeting the Caruaçu Formation with additional
potential in the deeper Gomo and Agua Grande Formations. Capital
expenditures of up to $11 million are budgeted in
2023 for Bom Lugar, including the development wells and facility
upgrades.
Mãe-da-lua (100% Alvopetro)
2023 capital expenditures include $0.5 million at our Mãe-da-lua
field where we plan to complete a stimulation of our existing well
to improve oil recovery rates.
Exploration (100% Alvopetro)
In 2022, Alvopetro drilled two exploration prospects, 182-C, and
183-B. We encountered thick, hydrocarbon saturated zones in the
Sergi Formation which have demonstrated low permeability during
testing operations. Alvopetro continues to evaluate alternatives to
enhance permeability in the Sergi Formation in both wells and in
the Agua Grande Formation of the 183-B1 well. We are evaluating
alternatives to remediate possible permeability impacts from near
wellbore damage. This work is expected to start with the
182-C2 well later this quarter. Capital costs of $0.4 million are currently budgeted on these
projects in 2023, including final testing costs on 182-C2 incurred
in January. Future capital expenditures will depend on these
initial results.
Semi-Annual Natural Gas Price
Redetermination
Effective February 1, 2023, our
natural gas price under our long-term gas sales agreement with
Bahiagás has been adjusted to BRL2.00/m3
or $11.88/Mcf (based on our average heat content to date and
the January 31, 2023 BRL/USD
foreign exchange rate of 5.10). This price represents an increase
of 3.6% from our prior contracted price and will be effective for
natural gas sales from February 1 to July 31, 2023. Including
recently approved and enhanced sales tax credits, our realized gas
price, net of sales taxes, is expected to be $12.40/Mcf (based on our average heat content to
date and the January 31, 2023
BRL/USD foreign exchange rate of 5.10).
Corporate Presentation
Alvopetro's updated corporate presentation is available on our
website at:
http://www.alvopetro.com/corporate-presentation.
Social Media
Follow Alvopetro on our social media channels at the following
links:
Twitter - https://twitter.com/AlvopetroEnergy
Instagram - https://www.instagram.com/alvopetro/
LinkedIn -
https://www.linkedin.com/company/alvopetro-energy-ltd
YouTube
-https://www.youtube.com/channel/UCgDn_igrQgdlj-maR6fWB0w
Alvopetro Energy Ltd.'s vision is to
become a leading independent upstream and midstream operator in
Brazil. Our strategy is to unlock
the on-shore natural gas potential in the state of Bahia
in Brazil, building
off the development of our Caburé natural gas field and our
strategic midstream infrastructure.
Neither the TSX Venture Exchange nor its Regulation
Services Provider (as that term is defined in the policies of the
TSX Venture Exchange) accepts responsibility for the adequacy or
accuracy of this news release.
All amounts contained in this new release are in
United States dollars, unless
otherwise stated and all tabular amounts are in thousands of
United States dollars, except as
otherwise noted.
Abbreviations:
bbls
|
=
|
barrels
|
boepd
|
=
|
barrels of oil
equivalent ("boe") per day
|
bopd
|
=
|
barrels of oil
and/or natural gas liquids (condensate) per day
|
BRL
|
=
|
Brazilian
real
|
m3
|
=
|
cubic
metre
|
Mcf
|
=
|
thousand cubic
feet
|
MMcf
|
=
|
million cubic
feet
|
MMcfpd
|
=
|
million cubic feet
per day
|
|
|
|
BOE Disclosure. The term barrels of oil
equivalent ("boe") may be misleading, particularly if used in
isolation. A boe conversion ratio of six thousand cubic feet per
barrel (6Mcf/bbl) of natural gas to barrels of oil equivalence is
based on an energy equivalency conversion method primarily
applicable at the burner tip and does not represent a value
equivalency at the wellhead. All boe conversions in this news
release are derived from converting gas to oil in the ratio mix of
six thousand cubic feet of gas to one barrel of oil.
Forward-Looking Statements and Cautionary
Language. This news release contains "forward-looking
information" within the meaning of applicable securities laws. The
use of any of the words "will", "expect", "intend" and other
similar words or expressions are intended to identify
forward-looking information. Forward–looking statements involve
significant risks and uncertainties, should not be read as
guarantees of future performance or results, and will not
necessarily be accurate indications of whether or not such results
will be achieved. A number of factors could cause actual results to
vary significantly from the expectations discussed in the
forward-looking statements. These forward-looking statements
reflect current assumptions and expectations regarding future
events. Accordingly, when relying on forward-looking statements to
make decisions, Alvopetro cautions readers not to place undue
reliance on these statements, as forward-looking statements involve
significant risks and uncertainties. More particularly and without
limitation, this news release contains forward-looking information
concerning plans relating to the Company's operational activities,
proposed exploration and development activities and the timing for
such activities, capital spending levels and future capital costs,
and the expected natural gas price, gas sales and gas deliveries
under the Company's long-term gas sales agreement. The
forward–looking statements are based on certain key expectations
and assumptions made by Alvopetro, including but not limited to
expectations and assumptions concerning the timing of regulatory
licenses and approvals, equipment availability, the success of
future drilling, completion, testing, recompletion and development
activities, the performance of producing wells and reservoirs, well
development and operating performance, expectations regarding
Alvopetro's working interest and the outcome of any
redeterminations, environmental regulation, including regulation
relating to hydraulic fracturing and stimulation, the ability to
monetize hydrocarbons discovered, the outlook for commodity markets
and ability to access capital markets, foreign exchange rates,
general economic and business conditions, the impact of the
COVID-19 pandemic, weather and access to drilling locations, the
availability and cost of labour and services, the regulatory and
legal environment and other risks associated with oil and gas
operations. The reader is cautioned that assumptions used in the
preparation of such information, although considered reasonable at
the time of preparation, may prove to be incorrect. Actual results
achieved during the forecast period will vary from the information
provided herein as a result of numerous known and unknown risks and
uncertainties and other factors. Although Alvopetro believes 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 Alvopetro can
give no assurance that it will prove to be correct. Readers are
cautioned that the foregoing list of factors is not exhaustive.
Additional information on factors that could affect the operations
or financial results of Alvopetro are included in our annual
information form which may be accessed on Alvopetro's SEDAR profile
at www.sedar.com. The forward-looking information
contained in this news release is made as of the date hereof and
Alvopetro undertakes no obligation to update publicly or revise any
forward-looking information, whether as a result of new
information, future events or otherwise, unless so required by
applicable securities laws.
SOURCE Alvopetro Energy Ltd.